ABUJA, April 3 (NNN-AGENCIES) — Nigeria’s president has appointed Bayo Ojulari – a former Shell executive – to lead the state-owned oil company, as part of sweeping reforms aimed at cleaning up the sector dogged by allegations of corruption, pollution and decades-long inefficiency.
Ojulari was picked in a “crucial” overhaul of the Nigerian National Petroleum Company (NNPC), the presidency said on Wednesday.
It added that the restructure – which also involved replacing the entire board – was necessary to drive economic growth in Africa’s biggest oil exporter.
President Bola Tinubu’s time in power has seen a series of economic shocks, with food and fuel prices rocketing over the past couple of years.
The NNPC has also been under financial strain – last September it admitted to having debts of around $6bn.
In its statement announcing the NNPC restructure, the presidency said Tinubu wished to boost Nigeria’s oil output and refining capacity.
Despite its massive oil sector, most of the crude oil Nigeria produces is exported, while it has to import the fuel it uses from other countries because it does not have enough oil refineries.
The cost of fuel used to be subsidised by the government – until this was removed by President Tinubu when he came to office nearly two years ago.
He said the country could no longer afford to pay for it, leading the price of fuel to skyrocket.
The subsidy was overseen by the NNPC and was shrouded in mystery leading to allegations of massive corruption.
However, oil marketers say the price at which fuel is imported is still higher than the pump price, leading many to believe that the government is still subsiding the cost of fuel through the NNPC, which it has denied.
Nigeria’s oil production slowed to less than a million barrels per day in 2023.
Tinubu’s administration wants to hit two million barrels per day of oil by 2027 and three million barrels per day by 2030.
Tasked with executing this mission, Ojulari replaces former NNPC boss Mele Kyari.
Some oil industry experts have expressed confidence in his appointment owing to his decades of experience in the oil sector, however they fear the challenges he inherits.
“The commission is indebted. Even the NNPC Ltd does not know how much it owes,” energy expert Henry Adigun said, adding “Its accounting has been marred by corruption and inefficiencies. I think it’s bloated. It’s a case of the more you read, the less you understand.”
Ojulari joined Shell Nigeria 1991 and rose to become managing director, a position he held for six years. He left the company in 2021 to join the investment advisory organisation BAT Advisory and Energy Company.
He then moved to Renaissance Africa Energy Company last year.
Along with trying to boost Nigeria’s oil production, Olujari will no doubt also seek to improve the NNPC’s poor public image.
For many years, under previous governments, much of the company’s profits never reached the treasury.
It is only in the last five years that the NNPC has been publishing accounts.
The new board appointed by President Tinubu comprises oil industry experts with decades of experience.
The hope is the team will be free of politics and restore transparency in the country’s murky oil sector.
“If he doesn’t succeed, it would be because of government interference,” Adigun added. — NNN-AGENCIES
