FG Creates 7 New Firms From NNPC
…Appoints new Managing Directors
Federal Government yesterday formally approved creation of seven new autonomous firms from the Nigerian National Petroleum Corporation (NNPC) and converted some of the Group Executive Directors of the corporation to Managing Directors of the new entities.
The new carved out of NNPC include Upstream Unit, Downstream Unit, Refineries Unit, Ventures Unit, Gas and Power Unit, Corporate Planning and Services Unit, and Finance and Accounts Unit.
The Chief Executive Officer appointed for the Upstream Unit is Mr. Bello Rabiu while Mr. Henry Ikem-Onih is the CEO for the Downstream Unbit.
Mr. Anibor Kragha is appointed CEO of the Refineries Unit; Mr. Saudu Mohammed for Gas and Power; and Babatunde Adeniran for Ventures.
The Group Executive Director in charge of Finance and Services would be Isiaka Abdulrazaq, while the Executive Head, Corporate Services will be Isa Inuwa.
The reorganization is seen to be part of the highly hyped institutional reforms expected to dismember the nebulous corporation into smaller manageable commercial entities with clear business targets.
President Muhammadu Buhari who authorised immediate unbundling of the corporation yesterday also approved that the appointment the new Managing Directors take immediate effect.
According to Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, who announced the new status of the corporation in Abuja five of the seven operational units would be strictly business-focused in line with global best practices of national oil companies.
Dr. Kachikwu had announced last week that the NNPC will be unbundled into 30 competitive revenue generating subsidiaries in weeks to come.
He had said that the move would reposition the corporation to bring in huge profits which has been impossible to achieve in the past 15 years adding that each of the companies would have its separate managing director as part of the ongoing transformation of the national oil company.
Until the recent development NNPC had 13 strategic business arms that included the Nigerian Petroleum Development Company (NPDC); Nigerian Gas Company (NGC); Integrated Data Services Limited (IDSL) and National Engineering and Technical Company Limited (NETCO).
Others include Products and Pipelines Marketing Company (PPMC); Warri Refinery and Petrochemical Co. Limited (WRPC); Kaduna Refinery and Petrochemical Co. Limited (KRPC); and Port Harcourt Refining Co. Limited (PHRC).
The rest are Hydrocarbon Services Nigeria Limited (HYSON); NNPC Retail; Duke Oil; NNPC Pensions Limited and National Petroleum Investment Management Services (NAPIMS) which coordinates the group’s involvement in joint ventures and production agreements operated by private partners.
It is not clear whether the new entities are additional to or replacement of some of the existing subsidiaries. If they are additional to existing subsidiaries, they would now bring the number of the corporation’s business arms to 20, creating hopes that additional 10 subsidiaries are underway.
Spokesman of the corporation, Mr. Ohi Alegbe, could not be reached las night for clarifications but he had earlier stated that the corporation would be unbundled into 30 profit-making companies with separate Managing Directors as part of the ongoing transformation of the national oil company.
The unbundling of the corporation, according to Dr. Kachikwu, is to steer the operations of loss making NNPC into the paths of commercial profitability by dismantling internal subsidies and challenging all the strategic business units to survive independently.
Under the new arrangement, bureaucratic coordination at the corporation’s headquarters would be narrowed down while all the subsidiaries would be granted administrative and financial autonomy to operate independently under separate Managing Directors.
“For the first time, we are unbundling the subset of the NNPC to 30 independent companies with their own Managing Directors. Titles like Group Executive Directors are going to disappear and in their place you are going to have Chief Executive Officers and they are going to take responsibilities for their titles. At the end of the day, the CEO of an upstream company must deliver an upstream result,” Dr. Kachikwu stated.