Stakeholders in the oil and gas sector are demanding that the National Petroleum Investment Management Services (NAPIMS) and Nigeria Gas Company (NGC), both subsidiaries of the Nigerian National Petroleum Corporation (NNPC) be made to operate independently, in order to have an efficient national oil company.
They stakeholders say that NAPIMS should be bestowed with proper supervisory power to manage the joint venture assets and oversee the activities of the international oil companies (IOCs) operating in the country.
They claim that the NNPC, as presently constituted, is too unwieldy and that this had been responsible for its inefficiency.
Diran Fawibe, chairman and chief executive of International Energy Services (IES) says NAPIMS would be more efficient if its activities were centred on managing the country’s oil assets for efficient operations.
Fawibe further says that the best thing for the government is to encourage the passage of the Petroleum Industry Bill (PIB) into law so that the new structure being proposed in the bill could replace NAPIMS.
The new structure, New Petroleum Asset Management Corporation (NPAMC) would hold all the six stakes in the unincorporated joint venture which NAPIMS currently oversees.
“With the new structure being proposed in the Petroleum Industry Bill (PIB) NAPIMS will transit into the New Petroleum Asset Management Corporation (NPAMC) which would carry out necessary supervision on the joint companies,” Fawibe says.
He adds that if NAPIMS was taken from NNPC, the problems of cash call would be minimised, explaining that the issue of not paying cash calls to the joint venture companies was not caused by NNPC but by the Federal Government (FG) which collects money from the corporation and fails in its obligation to pay for operations. “NAPIMS itself can manage government investments in oil companies effectively,” he posits.
He says there are many things responsible for the NNPC’s inefficiency and points an accusing finger at the government as the main culprit for all the inefficiencies that have bedevilled the organisation.
On the issue of the Nigerian Gas Company, Fawibe says the company would operate better if it were independent of the NNPC.
“NGC should be a separate body. Its functions should be performed outside the NNPC for efficiency sake,” he says
The IES boss explains that there are so many institutions currently embedded in the NNPC that should be removed. “But this would only happen when we have what is called NOC, which is proposed in the PIB. The NOC would behave like any other oil company in the world that is charged with the responsibility of exploring for oil, developing and producing the oil, he says.
Speaking in the same vein, Eddy Wikinna, managing director of Treasure Energy Resources, said the best situation is for the PIB to be passed into law, adding that when that happens, NAPIMS would automatically be taken off NNPC and we would have an efficient management of the country’s assets.
“Pass the PIB into law and everything would fall in place, because NPAMC, which would replace NAPIMS would take care of the concerns expressed by operators.”
On the NGC, Wikinna says its independence should not even be negotiated ,as the NNPC’s influence on its operations is tremendous. This, he said, also affected the operations of the company in terms of efficiency.
Toyin Akinoso, Publisher of Africa Oil and Gas Report, says the midstream of the gas sector should be liberalised so that other operators could come in to play. He says if there were other operators supplying gas through various pipelines to consumers, the issue of no gas supply to the power sector would be minimised.
“The government should open up the gas pipeline subsector by allowing others to come and operate under fair competition. Does anybody know that NITEL exists today with the number of communications companies in operation?” he asks.
NGC should be privatised, he advises.
On NAPIMS, he says, government should hands off the operations of the company and limit itself to regulatory functions of collecting taxes, as it would be more efficient doing those, rather than getting involved in businesses all over the place.
“Even if NAPIMS is independent of NNPC would government pay the cash call regularly and promptly? he asks.
OLUSOLA BELLO
