Prior to the yuletide season in few weeks today, the reappointment of the Group Chief Executive Officer of Nigerian National Petroleum Company Limited (NNPCL), Mele Kyari will change the narrative from the usual artificial scarcity of the Premium Motor Spirit (PMS) popularly known as Petrol as a result of the familiarity of the GCEO in operational activities in the energy sector.

During the annual Christmas festival in the past few years, the marketers in the oil Sector always create artificial scarcity of fuel, mainly hike the pump prices at the detriment of the poor masses but President Bola Tinubu in his prudent initiative steps this step to stabilise the system. 

The President in accordance with Section 59 (2) of the Petroleum Industry Act, 2021 has given his approval for the appointment of a new Board and Management team for the Nigerian National Petroleum Company Limited (NNPCL), effective from December 1, 2023.

Those appointed includes Chief Pius Akinyelure — Non-Executive Board Chairman; Mallam Mele Kolo Kyari — Group Chief Executive Officer; Alhaji Umar Isa Ajiya — Chief Financial Officer; Mr. Ledum Mitee — Non-Executive Director ; Mr. Musa Tumsa — Non-Executive Director; Mr Ghali Muhammad — Non-Executive Director; Prof. Mustapha Aliyu — Non-Executive Director; Mr. David Ogbodo — Non-Executive Director; Ms. Eunice Thomas — Non-Executive Director. 

The President also approved the appointment of two Permanent Secretaries: Mr. Okokon Ekanem Udo — Permanent Secretary, Federal Ministry of Finance; Amb. Gabriel Aduda — Permanent Secretary, Federal Ministry of Petroleum Resources

He emphasised on the importance of adhering to a performance-driven and results-oriented mandate in his Renewed Hope administration. The appointed team is expected to lead the implementation of an energy policy that maximises current oil and gas resources while paving the way for the exploration of new and cleaner energy sources in the future.

A peek into the achievements of Mr. Kyari, a Maiduguri-born Petroleum Engineer who inherited an NNPC that was still struggling to shake off the negative image of a national oil company where nothing works. The NNPC has been living in the dark shadows of a cesspool of monumental corruption and opacity; a place perpetually lagging behind its peers in other climes; where nothing is done properly and efficiency to the benefit of its shareholders, which are the Nigerian people but Kyari foresight in mastering the art brought total transformation.

Kyari knew NNPC needed a new vista and a break away from its decadent past. He saw his appointment as an opportunity of lifetime to give the NNPC a new direction in the way its operations and businesses are well conducted, and give Nigerians a renewed hope. The reform-minded oil guru and gas industry technocrat unfolded an agenda for NNPC’s rebirth. He called it the Transparency, Accountability and Performance Excellence (TAPE), a five-step strategic roadmap for NNPC’s attainment of efficiency and global excellence.

During the official unveiling of the TAPE agenda, Kyari said it was the only way to transform the NNPC and enhance its potential and capacity to compete with other national oil companies around the world. Kyyaritold members of the NNPC’s Management team to buckle up, shape up, ship in with the new direction, or ship out with the old ways of doing things.

He said the five steps for realising the objectives of TAPE were to ensure NNPC opened up its systems to public scrutiny; its operational processes were made transparent and accountable to the Nigerian people and the government; The new system would operate along with well-defined operational processes, benchmarked against established global best practices by world-class oil and gas companies; Set the right operational cost structure, to guarantee value-addition towards NNPC’s sustained profitability, and Set achievable goals, priorities and performance standards and criteria, by developing suitable governance structures for its strategic business units, and the entrenchment of team-spirit, work ethic and collaboration with all key stakeholders to achieve set corporate goals.

Key among the issues was the unresolved Petroleum Industry Bill (PIB), whose passage has continued to await the attention of the National Assembly and the government, fueling the pervading uncertainty among existing and prospective investors in the industry.

For instance, the final investment decision (FID) for the construction of Train 7 of the Nigeria Liquefied Natural Gas (NLNG) plant, of which NNPC is the principal partner, could not be taken after several postponements and delays. Partners could not reach a consensus on certain fundamental issues.

Also, there were some unresolved disputes that involved some communities in the Niger Delta region and some oil companies, which affected oil exploration and production activities in the region.

Although some of these issues remain unresolved completely, there are visible shreds of evidence of tangible steady progress in the last one year under the Kyari management at the NNPC.

The Nigerian Petroleum Development Company (NPDC) is the upstream exploration and exploration subsidiary of the NNPC. For years, the company has been struggling to grow its output capacity to about 250,000 barrels per day. Disputes by Niger Delta communities hosting some of its key oil fields frustrated its efforts, as its workers were denied access to critical oil fields.

Apart from the discovery of Oil in the Kolmani River-II Well, which is expected to significantly boost its oil production capacity, between NPDC and the Operations at oil mining lease (OML) 25, known as the Kula oil field, was shut down on August 11, 2017, following a dispute between Shell Petroleum Development Company (SPDC) and a local oil company, Belema Oil Producing Limited (BPL) over interests in the operations of the oil field in the Belema Community area.

Throughout the period of the dispute, the resolution of the dispute seemed far-fetched. The oil platform in Belema community in Akuku-Toru local council area of Rivers State was occupied by protesting community women and youth over alleged neglect and lack of development in the area. None of the parties conceded grounds.

But, Kyari was instrumental to the dialogue that restored normalcy in the area. Shortly after assuming office, he succeeded in mobilising all the parties in the dispute to the table for peaceful resolution of the dispute on September 17, 2019.

Following his intervention, all the issues were amicably settled. The traditional injunction that stopped oil production at the OML-25 oil flow station was removed.

A proposal of a roadmap for the development of the community was presented to the federal government and the NNPC in a new global memorandum of understanding (GMoU) granting the Belema community right to be involved in the maintenance and security of the oil facilities, while Shell remained the operator, along with its partner, the NPDC.

The significance of OML 25 is that it accounts for about 35,000 barrels of crude oil per day that production was shut-in during the period the oil field was shut down as a result of the dispute. The reopening of oil production activities in the area was a major boost to NPDC’s output and the country’s oil production capacity.

His intervention, which resulted in the resolution of all the issues that frustrated NPDC’s quest for increased oil production capacity ensured the company attained a new peak output of 331,400 barrels per day on May 28, 2020. In the 2019 financial year, Kyari ensured the NPDC maintained a unit oil production cost of $16.5 per barrel per day.

Within the last one year, Kyari ensured the execution of a funding and technical services agreement (FTSA) as well as an alternative financing deal for NPDC’s OML 13 valued at about $3.15 billion and OML 65 for $876 million. These agreements resulted is a 32 percent and 21 percent incremental production output in OMLs 40 and 30.

Also, 14 companies participated in the auction for the financing and redevelopment of OML 119 operated by the NPDC. The twin offshore block made up of Okono and Okpoho fields located approximately 50 kilometres offshore south-eastern Niger Delta operated by ExxonMobil.

Kyari described OML 119 as one of NNPC’s critical projects, which aligns with the Federal Government’s aspiration to boost the country’s crude oil and gas production, growing reserves, and monetising the nation’s enormous gas resources.

Kyari has also been able to save costs for the government through NNPC’s revision of joint venture and production sharing contract (PSC) operators’ unit costs, down to $19 per barrel and $18.3 per barrel, from the initial $31 per barrel and $24.3 per barrel respectively.

Concerned about the impact of high oil production cost on the government revenue, Kyari has, in the last one year, demonstrated commitment to achieving the industry target of reducing oil production cost to an average of $10 per barrel by 2021.

Under Kyari’s management in the last one year, the NPDC also acquired four new oil acreages (OMLs 11, 24, 116 and 98) while recovering debts for gas supplies totaling about N16.64 billion and $3.55 million.

In terms of gas development, Kyari has made significant progress in the development of an integrated gas handling facility, with the commissioning scheduled for the third quarter of this year.

Despite the challenges in the oil and gas industry, Kyari was able to ensure the NNPC subsidiary in charge of the government investment interests in the oil industry joint venture projects, the National Petroleum Investment Management Services (NAPIMS), was able to achieve an average oil production capacity of 1.8 million barrels per day prior to the recent decision by the Organization of Petroleum Exporting Countries (OPEC) to cut its members’ output to boost crude oil prices and stabilise the oil market.

Kyari has also supported NAPIMS to secure external funding for the SPDC’s Santolina 3 projects expected to deliver an average production of 16,300 barrels of oil per day, while also superintending over the resolution of the Escravos gas-to-liquids (EGTL) cost dispute with Chevron Nigeria Limited (CNL).

The settlement agreement is expected to bring in additional $2billion to the Federal Government in the next 20 years, while providing about 1.5 million litres of diesel per day to the country.

He took steps to resolve the disputes that affected activities in other oil concessions. Following his intervention, the “signing of novation agreement between NPDC and the Nigerian Agip Oil Company (NAOC) involving the transfer of OMLs 60, 61 and 63 was formalised.

Just as Nigerians were celebrating the milestone on the Nigeria LNG project, Kyari ensured President Muhammadu Buhari flagged off the EPC activities on the 614 kilometers-long Ajaokuta–Kaduna–Kano (AKK) pipeline project by NNPC last week.

Considered to be at the heart of the country’s economic growth, Kyari has pursued the execution of the project with single-minded commitment to see that it is completed on schedule in 2023.

The pipeline project represents phase one of the 1,300 kilometre-long Trans-Nigerian Gas Pipeline (TNGP) project being developed as part of Nigeria’s Gas Master Plan to utilise the country’s surplus gas resources for power generation as well as for consumption by domestic customers.

The TNGP project also forms part of the proposed 4,401 kilometre-long Trans-Saharan Gas Pipeline (TSGP) to export natural gas to customers in Europe.

The AKK pipeline system that will originate at the Ajaokuta terminal gas station (TGS) in the Kogi state will transport up to 3,500 million cubic feet (MCF) of gas per day from various gas gathering projects in southern Nigeria through Niger and Kaduna States, to terminate at a gas station at Kano State.

Apart from helping the government to save over $300 million, the AKK project would also attract over $2billion of FDI.

Prior to his appointment, hiccups in the supply of petroleum products was a common feature in the Nigerian economy. The incessant disruptions in fuel supply affected Nigerians’ ability to plan effectively. They could not predict when the next fuel scarcity would hit the country and send families to spend days and nights in long fuel queues at filling stations.

Kyari leveraged on the existing Direct-Sales-Direct-Purchase (DSDP) product supply arrangement he started and sustained while in office as the GGM COMD of the NNPC, to guarantee energy security for Nigerians.

For years, the NNPC has always defaulted in remitting to the Federation Accounts revenues realised from its operations. Every audit conducted by the Nigeria Extractive Industries Transparency Initiative (NEITI) on the activities of the oil and gas industry has always ended with reports indicting the NNPC for not remitting several billions of unreconciled balances to the Federal Government.

But, under Kyari, NNPC has always ensured timely and regular remittances of all revenues accruable to the Federation Accounts Allocation Committee (FAAC) for distribution to the three tiers of government.

Another priority that has placed the leadership of the oil Sector above the water is drastic reduction of oil thieves in collaboration with the security agencies compared to the mirage being witnessed by the past Administrations. The removal of the fuel subsidy by Mr. President also adds more accolades to management of the Sector by winding off cabals.

Ultimately, the reappointment of Kyari as the stewardship of the crude oil sector will bring stable policy formulation and implementation without rancour. However, much is expected from the GCEO especially in the area of ensuring that the three refineries become functional to the benefit of Nigerians.

The recent revelation that Nigeria has lost a staggering $16 trillion to gas flaring over the past decade highlights the country’s prevailing culture of waste and institutional failures.

Despite a national program decreeing an end to this practice, oil-producing companies have continued to burn off natural gas during oil extraction and processing, resulting in wasted energy, environmental degradation, and significant economic losses.

However, a large portion of this valuable resource is being needlessly flared. This is a missed opportunity for a country grappling with financial challenges, including a foreign debt of $43.16 billion and an infrastructure gap estimated at $3 trillion over the next 30 years.

Additionally, Nigeria faces high unemployment rates of 33.3 percent and is home to the second-largest number of poor people globally.

A country with such poor human development indices should be prioritising the maximisation of its natural resources, rather than burning them and further damaging the environment and the health of its citizens.

Modern technology offers effective gas-trapping methods during crude oil extraction, which other countries have successfully deployed to boost their economies. Nigeria must seize this opportunity to harness its gas reserves for sustainable development and economic growth.

The persistence of gas flaring in Nigeria is a testament to the long-standing failures of successive governments and regulatory agencies. For decades, they have recklessly allowed oil companies to defy regulations and continue this harmful practice.

This lack of accountability and enforcement has not only perpetuated environmental and health concerns but has also resulted in significant economic losses for the country.

President Bola Tinubu must recognise the urgency of the situation and take decisive action to end gas flaring in Nigeria.

This will require robust regulatory measures, strict enforcement, and collaboration with oil-producing companies to adopt modern technologies for gas trapping. By doing so, Nigeria can unlock the immense economic potential of its gas reserves, address its financial challenges, and improve the well-being of its citizens.

It is time for Nigeria to break free from its culture of waste and embrace a sustainable and prosperous future.

Tinubu, who has retained the oil ministry portfolio, must therefore fully enforce the Nigerian Oil and Gas Industry Content Development Act that stipulates penalties for gas flaring and mandates oil companies to stop flaring gas.

In the vast expanse of Nigeria’s oil and gas industry, a troubling trend persists. Upstream and downstream companies have shamelessly flared an astronomical amount of gas over the years, causing significant financial and environmental losses.

The numbers speak for themselves: 12.9 billion cubic metres in 2012, 9.2bcm in 2013, 8.3bcm in 2014, and 7.5bcm in 2015. Although there was a slight dip in 2016, flaring surged again in 2017, reaching 7.8bcm in 2019.

This wanton waste of resources has cost the nation an estimated $16 trillion during this period.The impact of this reckless behavior extends beyond Nigeria’s borders.

In 2018 alone, global gas flaring cost the world economy a staggering $20 billion, with Nigeria contributing $761.6 million. It is disheartening to note that Nigeria, along with just nine other countries, accounts for 75 percent of global gas flaring.

These countries include Russia, Iraq, Iran, the United States, Venezuela, Algeria, Mexico, Libya, and China, as confirmed by the 2022 Global Gas Flaring Tracker Report.

The consequences of this rampant flaring are far-reaching. According to data from the National Oil Spill Detection and Response Agency, oil companies in Nigeria flared gas worth over $1 billion between January 2022 and August 2023, resulting in a staggering financial loss of N843 billion.

This wasted gas could have generated a substantial amount of electricity, approximately 14,700 gigawatt hours, but instead, it contributed to carbon dioxide emissions equivalent to 7,800 metric tonnes.

The toll on the economy, environment, and the health of residents in and around oil-producing areas is undeniable.It is imperative for the government to adopt responsible fiscal and resource management practices. Additionally, it must address the issue of industrial-scale theft of crude and refined petroleum products, which has plagued the industry for years.

 With daily crude theft reaching a staggering 400,000 barrels per day, Nigeria has lost a mind-boggling 619.7 million barrels of crude between 2009 and 2020, valued at $46.16 billion or N16.25 trillion, according to the Nigeria Extractive Industries Transparency Initiative (NEITI).

The time for change is now. Nigeria must take decisive action to curb gas flaring, protect its resources, and ensure a sustainable future for its people.

In addition, the National Environmental, Economic and Development Study for Climate Change in Nigeria states that the annual environmental cost of gas flaring amounts to N28.8 billion.

Despite the government’s efforts to eliminate gas flaring, progress has been slow and hindered by bureaucracy. To address this issue, Tinubu should revive the Nigeria Gas Master Plan and set a new target date of 2030 to end gas flaring.

Nigeria has the potential to become a leading exporter of natural gas if it takes decisive action. Tinubu should demonstrate the necessary political will and implement concrete measures to strengthen the regulatory framework and ensure compliance from oil companies.

A carrot-and-stick approach, offering incentives for capturing and utilizing natural gas while imposing stronger sanctions for flaring, can be adopted.

Nigeria should also leverage its membership in the Global Gas Flaring Reduction Partnership to implement quick-win policies and invest in the latest technology. Repurposing gas flaring sites for productive uses would create employment opportunities and address gas shortages for power generation and domestic use.

With the high demand for gas in Europe and domestically, now is the ideal time to utilise flared gas for productive purposes. This would generate significant revenue for the government and contribute to economic recovery.

Health is also an urgent issue. Gas flaring harms local ecosystems, emitting pollutants such as sulphur dioxide, nitrogen oxides, and particulate matter, which have adverse effects on air quality and human health in the oil-producing region. The pollutants cause respiratory problems, cardiovascular diseases, and other health issues in nearby communities.

Nigeria is teetering on the edge of a severe food crisis, a situation that demands immediate attention and action.The latest report from Cadre Harmonise (CH) paints a distressing                   picture: an estimated 26.5 million Nigerians, spread across 26 states, face the threat of significant food shortages from June to August 2024.

This alarming projection was shared at a crucial meeting led by the Kwara Ministry of Agriculture and Human Development, in partnership with CH and other stakeholders.

The report’s findings are particularly concerning for the most vulnerable populations, including the internally displaced persons in Zamfara, Sokoto, and Borno states.

These individuals are already in precarious situations, and the forecasted food scarcity could exacerbate their plight to critical levels.

The potential for widespread hunger and malnutrition is a clear and present danger that must be addressed.

The Permanent Secretary of the ministry,  Isiaq Oloruko-oba, emphasised the severity of the looming crisis during the meeting.

He reiterated the resolve of the state government to ensure relevant stakeholders, especially farmers, are empowered and receive the necessary aid to ensure food security in the state.

His remarks highlighted the urgency with which the nation must address the issues of food and nutrition security. The report, thus, is not just an analysis of the current state but a dire warning that requires immediate and strategic response.

The implications of this report are far-reaching. It is a call to action for Nigeria’s policymakers, urging them to step up and take responsibility for averting what could be a catastrophic food shortage.

The time for mere discussion has passed; the situation now demands concrete plans and swift implementation. To mitigate the impending crisis, a multi-faceted approach is necessary.

This includes bolstering agricultural production, improving supply chain logistics, and ensuring that aid reaches the most vulnerable populations. It also involves addressing the underlying causes of food insecurity, such as conflict, climate change, and economic instability.

The government, along with non-governmental organizations and international partners, must collaborate to create and execute a robust plan of action.

This plan should not only aim to prevent the immediate crisis but also to lay the groundwork for long-term food security in Nigeria. Public awareness and community engagement are also critical components of the solution. The citizens of Nigeria must be informed about the severity of the situation and mobilised to support and participate in efforts to secure food for all.

Local initiatives that empower communities to grow and store their own food can be part of a sustainable strategy. The CH report is a stark reminder of the challenges Nigeria faces in ensuring food security for its population.

It is a clarion call that must not go unheeded. As the nation stands at this critical juncture, decisive action is the only path forward to prevent a national disaster and ensure that no Nigerian goes hungry. The time to act is now.

The state government’s commitment to empower farmers and ensure food security, as reiterated by Oloruko-oba, is commendable.

However, this must translate into tangible support and aid for those who are the backbone of our nation’s food supply.

The role of agriculture as a lifeline for the majority of Nigerians cannot be overstated, as highlighted by the state CH coordinator, Olusoji Oyawoye.

With a population of approximately 3.73 million, Kwara’s reliance on traditional subsistence farming is a testament to the need for bolstering agricultural practices and supporting crop diversification.

The cultivation of rice, cassava, yam, soya beans, maize, bean seed, guinea corn, groundnut, and cowpea, along with tree crops like cashew nuts and palm oil, forms the bedrock of Kwara’s agricultural output.

The exploitation of hardwood timber and forest resources such as shea nuts and locust bean also contribute to the state’s economy. These resources must be managed sustainably to ensure long-term food security.

Furthermore, as the state coordinator of the Accelerating Nutrition Results in Nigeria (ARIN) project, Habeeb Lawal, aptly noted, nutrition is inextricably linked to food security.

The looming crisis is not only about the availability of food but also about its nutritional value. A malnourished population is less capable of contributing to the economic development and stability of the nation.

This editorial serves as a call to action for all stakeholders, from government officials to international partners, from farmers to consumers, to come together and address the challenges laid bare by the CH report.

It is imperative that we work collaboratively to develop and implement a comprehensive strategy that includes improving agricultural practices, ensuring the distribution of aid, and enhancing the nutritional content of food available to the Nigerian populace.

The threat of a food crisis is not just a statistic; it is a reality that millions could face if we do not act now. Let us not wait until the crisis is upon us.

The time to act is now, with the urgency and seriousness that the situation demands. Our collective future depends on it. all critical stakeholders to deliberate on the way forward.