A Review of the Nigerian Energy Industry

NNPC reform: Massive redeployment of staff begins, causing anxiety

NNPC Towers
*NNPC Towers.

*As oil workers demand quick passage of PIB

Oscarline Onwuemenyi

07 November 2015, Sweetcrude, Abuja – The Nigerian National Petroleum Corporation, NNPC, has begun the redeployment of its staff members across the different business units, a situation which has generated great anxiety among affected staff.

The ongoing massive redeployment exercise is said to target mostly the mid-level staff of some of the NNPC’s subsidiaries including the Pipelines and Products Marketing Company, PPMC, and the Nigerian Petroleum Development Company, NPDC.

However, an official of the Corporation, who confirmed this development, indicated
that it was part of the ongoing reforms initiated by the new Group Managing Director, Dr. Emmanuel Kachikwu to ensure efficiency within the NNPC structure.

He noted that, “The redeployment of staff is taking place across all the major units as well as subsidiaries of the Corporation. It’s not just within any particular unit or subsidiary since every decision taken by management invariably affects all the units and subsidiaries. It’s nothing strange, but it’s in line with the ongoing reform objectives of the new leadership in the NNPC.”

He added that the redeployment exercise is in line with “the reform agenda encapsulated in the ’20 Fixes’ action plan of the Dr. Kachikwu-led NNPC management” to transform the Corporation into a lean, efficient, business-focused, transparent and accountable national oil company in keeping with international best practices.

Upon resumption in August, Kachikwu had adopted what he described as “20-fixes” with which he hopes to reform NNPC operations, guarantee profitability and run a transparent national oil company.

Accordingly, the “20-fixes” make up twenty critical issues that the Corporation’s current management had identified and would need to address in order to create a more nimble organisation and re-position it on the path of profitability.

President Muhammadu Buhari had specifically appointed Kachikwu to drive his reform agenda for the oil and gas behemoth, and had sacked and replaced four directors of the Corporation after just days of his resumption.

The NNPC boss explained that through the “20-fixes” which are embedded in five cardinal business objectives that he intends to pursue, are plans to amongst other initiatives, attain zero tolerance for corruption, restructure its major subsidiaries as well as enhance probity in its operations across board.

Contained in its monthly financial and operational reports for the month of August, the Corporation’s “20-fixes” also include its intentions to restructure Joint Venture funding and reduce cash call demands; improve retail profitability; deploy and attract focused investments; expand crude oil marketing and generate electricity profitably.

Also to be done within the initiative are, reduction and audit of running costs; restructuring of corporate centres and staff; renegotiation of existing contracts including Production Sharing Contracts (PSC); streamlining of subsidy management as well as improve security of the country’s critical petroleum pipelines.

The new management’s reform agenda, obtained by our correspondent in Abuja, also indicated that three of the corporation’s subsidiaries, the Nigerian Gas Company (NGC); Pipeline and Products Marketing Company (PPMC) and the Nigerian Petroleum Development Company (NPDC) would either be unbundled or re-kitted.

The corporation will also restructure its refining business; improve on its use of information technology for its businesses and demand for topnotch service performance from all its staff.

He explained that the reform measures to be initiated, would be in line with the Federal government’s intentions for the country’s oil and gas sector.

Notwithstanding its pursuit of the “20-fixes”, oil workers under the auspices of the
Petroleum and Natural Gas Senior Workers Association of Nigeria (PENGASSAN) have asked the federal government to consider complete opening up of the forest of Arepo in Ogun State and set up a new military barrack there to tackle incessant breaks on petroleum pipelines that pass through the axis.

The National President of PENGASSAN, Francis Johnson made the call at the triennial delegate conference of the PPMC unit of PENGASSAN in Abuja.

Johnson explained that the challenging topography of Arepo where pipeline vandals have consistently sabotaged petroleum flows could continue to grant overriding advantages to the vandals, thus ensuring that government’s efforts at minimising products cuts would remain inadequate.

“What we are saying is that Arepo is a very thick forest and those guys see us but we cannot see them, once we try to work there, they will level anybody they see there.
What we are then saying is that they should look for a way to deforest that place.

“They can ask Julius Berger or anybody to clear there, sand-fill it and then situate a military barrack there with military personnel on rotation and not on permanent basis because when they are permanent, there could be possibilities for them be compromised,” Johnson said.

He further noted: “That place is a very thick forest and from there products are supplied to Mosimi Depot and other parts of the country, hence, it is important that the government should take such step. For us, at PENGASSAN, we want to see a solution because lives are consistently lost there.”

Speaking on the union’s expectations from the government’s incoming minister of petroleum resources, Johnson noted that PENGASSAN would want a fervent push for an immediate passage of the Petroleum Industry Bill (PIB).

On this he said: “We know that the president has said that he is going to hold the portfolio for 18 months and then have a minister of state which is likely going to be the current GMD of NNPC.

“What we also like to be done is that we get a legal framework for the industry. The PIB must be passed fast. The GMD of NNPC stated recently how much we lose as a result of the non-passage of the PIB.

“We must have a legal framework for the industry or else people will lose interest and divest. That is what the government should address now, thank God the government in power have a majority in the National Assembly.”

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