Wednesday, September 02, 2015

Challenges, Way Forward For NNPC, Oil Industry


Louis Brown Ogbeifun (Image source: LinkedIn)

Comrade Brown Ogbeifun, until his retirement last month, was Industrial Relations Manager, Nigerian National Petroleum Corporation, NNPC. He was also the President of the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, and the First Deputy President General of the Trade Union Congress of Nigeria, TUC.

As a Unionist, he served in committees such as Committee on Socio-Economic Impact of Downstream Deregulation in Nigeria, Committee on the Privatization of NNPC Downstream Sector, among others. Today, Ogbeifun is the President of the Institute of Mediation and Conciliation; Nigeria

In this interview, he speaks about the new management’s re-positioning in NNPC, reforms in the oil sector, corruption among others.

SweetCrude Interview Excerpts:

What do you think are the challenges confronting the nation’s oil and gas industry?

Generally, the oil and gas industry in Nigeria has faced its most difficult times in the last decade. NNPC being a key player in the sector has unfortunately been the most brutalized and maligned by the Nigerian State.

When one takes a cursory and reflective appraisal of the spate of criticisms against the NNPC against the backdrop of the fact that oil and gas have been used as a potent tool for the socio-economic advancement of Norway, Brazil, Saudi Arabia, Kuwait, Qatar, Malaysia; one cannot but empathize with the informed, who falsely accuse NNPC of ills perpetrated by the same government that should protect her; and the uninformed who innocently castigate NNPC workers for no fault of theirs.

Whereas other oil producing nations have efficient, effective, reliable and enviable infrastructure, health, educational and agricultural systems with sustainable industrial growth, Nigeria’s case reflects a paradox of these ideals.

The desire of the country was to increase the National Oil Reserve base from 36.22 billion barrels to 40 billion barrels with a daily production of 4.5 million barrels by the year 2010. Five years over and above that timeline, we are not doing up to half of that expected optimum because of cyclical and vicious cycles of vandalism, massive crude oil theft and lack of serious direction as typified by the conspiracy of the ruling class in the non-passage of the PIB.

There is no gain saying that Nigeria has lost dominant grip on her oil and gas business. Nigeria has remained a net importer of dollar-driven white petroleum products, instead of the other way round. Ever before the slump of crude oil prices, the level of profits in the older Joint Venture agreements had drastically reduced.

The governors not benefiting maximally from the beggarly Nigerian rent economic system, which has worsened with the slump in crude oil price, made it easier for the NNPC to be consigned to the slaughterhouse.

With the above sordid state and the forecast that the present oil reserve is expected to last for just a little above thirty years, if no additional reserve is added, one has to be worried stiff for the future of the country. There is nothing in the horizon that points to any serious plans for diversification and growth of other sectors. Worst still, the games of crude theft and vandalism of petroleum pipeline products are not abating. It is for these reasons that every right thinking person must support the oil and gas initiatives of President Muhammadu Buhari.

The new GMD of NNPC, Dr. Ibe Kachikwu has been given the marching others to recover some “lost trillions”. We should support him to effectively carry out his mandate.

While this goes on, I hope that every inch of this journey shall not be vindictive or opaque. It must be so transparent to the extent that even if past Heads of States or Presidents are identified in the findings by any of the Committees set up by the Federal Government on NNPC or other oil and gas related issues, the names of the culprits must be published and they should be made to face the wrath of the law. Let the workers’ teeth not ache for the apple eaten by the political class through systemic and cyclical political maneuvers.

If this government truly wants to reposition the oil and gas industry for the future we all dream of, it must be ready to go beyond the window dressing of untimely retirements of hardworking innocent staff; and deal with the tap root of the endemic political interference in the running of the NNPC, which has become the Achilles heels of the organization.

How do you think the rot in industry can be addressed?

There is no doubt also that there is still lack of clarity in the current financial regimes, royalties and taxes in the oil and gas sector. This is vivid with the confusing and conflicting figures reeled out during reconciliation processes among the agencies responsible for the receipts of the funds meant for the federation account. While the anti-corruption mantra of the government should be encouraged and supported albeit as regards the NNPC, all actions should be cautiously taken in the restructuring, reorganization or re-positioning of the NNPC. The actors involved in this process should be guided by a sense of history and Mr.

President’s promises of creating and not destroying job. It is therefore, an imperative that whatever must be done to clean up the rot in the oil and gas industry, every inch of the journey must be transparent, not selective and must display utmost respect for the dignity of man.
The proposed use of forensic audit to investigative process of all the agencies involved in the oil and gas inflows and outflows is a welcome development. However, this anti- corruption drive must not be selective. This government must go beyond 2010 if it is sincere in truly ridding the country of corruption.

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