Gov El Rufai Wants NNPC Disbanded, Refineries Sold

Governor Nasir el Rufai delivering his lecture
Governor Nasir el Rufai delivering his lecture

Kaduna State governor, Nasir El-Rufai, has said in order to combat the corruption in the oil sector, the country needs to disband the Nigerian National Petroleum Corporation, NNPC, and replace it with a national oil company that would be “capitalized once and for all, and then freed to fend for itself like other national oil companies do.”

The governor also advocated the privatization of the nation’s refineries, contending that it was the most realistic option open to the country.

El Rufai spoke on Monday at the 2015 Wole Soyinka Centre Media Lecture Series, themed “Nigeria and the Oil Fortune” at the Sheraton Hotel, Abuja, where he was the guest speaker.

The governor alleged that the NNPC had become a “parallel government” that had “remitted about 58% of the monies earned between 2012 and the first half of 2015,” adding that “a company with the audacity to retain 42% of a country’s money has become a veritable parallel republic!”

Invariably, the former Federal Capital Territory, FCT, minister observed, the oil giant consumes “more resources than the 36 states, the FCT and the Federal Government combined.”

“We should replace the NNPC with brand new organizations that are fit for purpose: – among others – a commercialized and corporatized national oil company and new industry regulators,” he stated.

“This country can no longer afford to maintain an NNPC that arrogantly, unlawfully and unconstitutionally spends an unhealthy proportion of national oil earnings on itself,” he added.

On the nation’s refineries, el Rufai went down memory lane and recollected that the Olusegun Obasanjo administration had sold two of them before leaving office, an action that was reversed by the Umaru Yar A’dua government.

“Eight years and millions of dollars in turn-around maintenance later, the refineries are at best a minor component of our supply sources for refined products while remaining a suction pump of our resources,” he observed.

To get out of the devious cycle of maintaining refineries that do not serve the nation’s purpose, the governor advised the government to “incentivize competent investors to acquire majority shares and management control in all our refineries and sell to them crude oil at market prices.”

El Rufai lamented that although Nigeria is an oil rich country, the larger percentage of the population does not enjoy the benefits from the oil wealth.

He observed that the country makes enormous fortunes from its oil assets but contended that the problem was the management of the resources.

Reeling out figures to back his position, he stated that the nation earned about $500 billion during President Goodluck Jonathan years, adding that despite a 60 per cent fall in oil prices in 2014, the country still earned $77 billion from oil exports.

Sadly, he observed, for the vast majority of Nigerians, “oil is no fortune.”

“It is more of a mirage, but a more insidious kind, because the fortune is visible in the lifestyles of a few thousands of the privileged elite but is stubbornly inaccessible to tens of millions of ordinary people,” he observed.

One of the discussants at the event, Sam Omatseye, chairman of the editorial board of The Nation newspaper, however, disagreed with el Rufai, positing that replacing the NNPC with a new company may not solve the problem.






     

     

    Rather, he suggested, the focus should be on strengthening institutions so that people can be made to follow rule of law.

    “When you have rule of law, when you have a fidelity to the conscience of the law, every other thing will find its place. You cannot have an NNPC spending more on cost than it gives in profit because everything will have to be written down and codified in law,” Omatseye explained.

    The Wole Soyinka Lecture Series, which started in 2008 is held yearly in honour of Nobel Laureate Wole Soyinka in celebration of his birthday.

    Other discussants at this year’s event were Adefunke Kasali, executive secretary, Nigeria Extractive Industries Transparency Initiative, NEITI and Deji Haastrup of the public affairs department of Chevron Nigeria.

     

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