Tinubu tongue-lashes NNPC boss, Kachikwu over fuel scarcity

Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, on Saturday got a tongue-lashing from the national leader of the ruling All Progressives Congress, Asiwaju Bola Tinubu, over his recent comments on the lingering fuel scarcity in the country.

Bola Tinubu

The former Governor of Lagos State took a swipe at the minister, who is also the Group Managing Director of the Nigeria National Petroleum Corporation, for saying he was not a magician who could end the scarcity of Premium Motor Spirit, also known as petrol.

The APC leader stated that the minister was answerable to Nigerians and not the other way round.

Tinubu stated this on Saturday in a statement titled, ‘Kachikwu Needs to Know That Respect and Good Performance Will Do What Magic Cannot.’

Referring to the minister, Tinubu said he believed a member of the President Muhammadu Buhari-led government “has strayed from the progressive calling required of this administration.”

Kachikwu had on Wednesday, while speaking with State House correspondents shortly after he led a joint delegation of the Petroleum and Natural Gas Senior Staff Association of Nigeria and the Nigeria Union of Petroleum and Natural Gas Workers to meet with Buhari at the Presidential Villa, Abuja, said since he was not a magician, the fuel queues could not be eliminated with a magic wand.

He added that despite the efforts being put in place by the Federal Government, fuel queues might not be completely eliminated until about two months (May).

The minister noted that with the reality on the ground, it was by sheer magic that the country had the amount of products it currently had at the filling stations.

However, Tinubu, on Saturday, stated that there might be no economic matter more difficult to unravel and more sensitive to the purse of the average person than the current fuel scarcity.

The APC leader said despite that, he was confident of progress because he knew the commitment of the President to resolving the issue.

“I make no attempt to hide it. I am an avid and partisan supporter of this government and of the progressive policies of the party, the APC, upon which this government is based,” the ex-governor stated.

Tinubu added, “With that, I do reserve the right and the duty as a Nigerian to voice my opinion when I believe a member of this government has strayed from the progressive calling required of this administration. I do this because my greater devotion and love are for this nation and its people. Party and politics fall secondary.

“Much public ire has been drawn to the statement made by the Minister of State (for Petroleum Resources) Ibe Kachikwu that he was not trained as a magician and that basically Nigerians should count themselves fortunate that the NNPC under his stewardship has been able to bring in the amount of petrol it is currently doing.

“Perhaps the statement by Kachikwu was made in a moment of unguarded frustration or was an awkward attempt at a joke. Whatever the motive, it was untimely and off-putting. The remark did not sit well with the Nigerian people; they were as right to feel insulted as the minister was wrong to have said such a thing.

“The fuel shortage is severely biting for the average person. They are forced to remain in lines far too long — for too much time — to pay too much money for too little fuel. This is no joking matter. Livelihoods and people’s welfare are at stake.

“With so much on the line, Kachikwu’s flippancy was out-of-line. He was basically telling Nigerians that they should be lucky that they are getting the inadequate supply they now suffer and that they should just be quiet and endure the shortage for several weeks more.”

Saying Kachikwu’s intervention was unhelpful, the APC leader said it rather panicked and disappointed the public as to the duration of the crisis.

“It insulted the people by its tonality. He spoke with the imperious nature of a member of the elitist government the people voted out last year and not the progressive one they voted in,” he added.

Tinubu also said Kachikwu must be reminded that he was not coerced to take the job, adding that the minster accepted the job and its responsibilities “knowingly.”

The ex-governor said the NNPC GMD must also remember that he does not own the corporation and that the NNPC was not a private company that owes nothing to the public except the duty of fair dealing.

Tinubu added, “He is a public servant. The seat he sits upon is owned by Nigerians, not by him. The company he runs is owned by Nigerians, not by him. They are his boss. He is not theirs. Power is vested in the people. He is a mere custodian or agent of their will.

“In talking to us in such a manner, he committed an act of insubordination. If he had talked so cavalierly to his boss in the private sector, he would have been reprimanded or worse. If wise, the man should refrain from such interjections in the future.

“As his ultimate bosses, the people have a right to demand the requisite performance and respect from him.  He should apologise for treating them so lightly in this instance.”

The APC leader noted that as Kachikwu’s portfolio was a strategically important one, the minister needed to re-establish the correct relationship with the public.

He said Nigerians no longer felt Kachikwu was working for their optimal benefit as their servant. “Instead, he seems to be standing above them, telling them to take it or leave it,” Tinubu added.

The politician stated that for the minister’s policies and stint in office to be successful and of help to the government, he (Kachikwu) must have the support and belief of the people at this tough time.

Tinubu said the NNPC boss must talk to them in a way that they believe he seeks their best interest and understands the hardship weighing upon them.

“He must ask them to work with him and, perhaps, to endure a bit longer but with the knowledge that he is working to resolve this matter as fast as he can and as permanently as possible; that he is dedicated to the position that once these current lines are gone, never again shall they reappear, as long as he has any influence in the matter.

“To do this requires no magic or training in that strange craft. It requires empathy, compassion and the willpower to forge a better Nigeria. These must be the common trademarks of those serving in a progressive government, for these attributes are integral parts of the spirit and ideals upon which the APC was founded,” Tinubu added.

When contacted, the Director, Press and Public Relations, Ministry of Petroleum Resources, Mr. Idang Alibi, told SUNDAY PUNCH that the ministry had yet to see the statement by Tinubu.

He stated that the ministry would wish to react to it when it gets the statement and promised to get across to Kachikwu and respond to our correspondent.

Alibi said, “We will need to find out what Tinubu actually said before getting across to the minister.”

When asked if he would get back to our correspondent after speaking with the minister, he replied, “Well, it depends on the response from the other side. If I get a response, I will get back to you.”

When probed further if he would get across to the minister on Saturday night, Alibi replied again, “I hope so.”

Also, calls to the mobile phone of the Group General Manager, Group Public Affairs Division of the NNPC, Mr. Garba Deen, were not answered.

A detailed text message sent to him was also not replied.

Up till the time (8.53pm) of filing in this report, no response was received from the ministry and the NNPC.

The scarcity of petrol has lingered since January, as hundreds of motorists besiege few filling stations that dispense the product on a daily basis.

Kachikwu’s comment had drawn heavy criticisms from various stakeholders, including the organised labour, petroleum marketers, oil industry workers, manufacturers, experts in the oil sector and the latest from Tinubu.

The Trade Union Congress had specifically asked Kachikwu to resign instead of giving Nigerians excuses on why it would be impossible to get fuel easily in the country before June.

The TUC, through its President, Mr. Bala Kaigama, said the positions occupied by the minister were too demanding for him and urged Buhari to appoint a new GMD for the NNPC.

Kaigama stated, “If he is not a magician, he should resign now. What we are saying is that Nigerians are getting impatient with him.

“So, if he has no quick fix to it, he should just quit. We are getting impatient. He is moving from one unpopular policy to another, yet we cannot see any quick fix.’’

Similarly, the Nigeria Labour Congress had described Kachikwu’s statement as unfortunate.

The General Secretary of the NLC, Dr. Peter Ozo-Eson, said it was wrong of any agent of government to resign himself to a position that would subject Nigerians to months of long fuel queues.

He said, “As far as we are concerned, one day of queues is unacceptable to Nigerians and the hardship Nigerians have been subjected to, through the queues over a long period now, is actually something that should be condemned.

“Apart from the hardship to Nigerians, the cost of these protracted queues on an economy that is already in crisis is enormous, and actually makes the issue of the revival of the economy even more difficult.”

Also, workers in the oil and gas sector on Wednesday said they were at a loss as to what was really the cause of fuel scarcity in the country.

The workers, who spoke under the aegis of PENGASSAN and NUPENG, stated that the minister should be questioned on the development.

Tinubu tongue-lashes NNPC boss, Kachikwu over fuel scarcity

President Approves NNPC’s Restructuring into Seven Units, 20 Companies

• Nigeria to stop importing petrol in 18 months, says Kachikwu

• House opposes new structure, minister clarifies state oil firm has not been unbundled

President Muhammadu Buhari has approved the restructuring of the Nigerian National Petroleum Corporation (NNPC) into seven new divisions, Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, announced on Tuesday at a press briefing in Abuja.

Managing Director of the NNPC, Mr. Emmanuel Kachikwu

He explained that under the new structure, NNPC will have five core new divisions comprising the upstream, downstream, refining group, gas and power, as well as the ventures’ groups. The other two, he said, are finance and services groups.

He said the restructuring was the only opportunity available to the NNPC to become productive again, adding that employees of the corporation would have to work to earn their wages going forward.

Kachikwu pointed out that nothing much had changed with the unbundling except for the distribution of subsidiary companies of the corporation that would further be restructured into direct management of the new divisions.

He named some of the heads of the new divisions to include Mr. Bello Rabiu who would take charge as the head of the upstream company; Mr. Henry Ikem-Obi who would head the downstream company; Mr. Anibor Kragho as the head of refining group; Mr. Saidu Mohammed as head of gas and power market; and Babatunde Adeniran as head of the ventures’ groups.

Isiaka Abdul Rasaq is the chief financial officer, while the deputy managing director of the Nigeria Liquefied Natural Gas (NLNG), Mr. Isa Inuwa is now to head the corporate services unit of NNPC.

He listed some of the subsidiaries under the divisions to include Upstream: the Nigerian Petroleum development Company (NPDC) and Integrated Data Services Limited (IDSL); Downstream Retail: Nigerian Product Marketing Company (NPMC), which was formerly PPMC, (NPSC); Gas and Power: Nigerian Gas Pipeline and Transportation Company (NGPTC), Nigerian Gas Marketing Company (NGMC), and gas and power investment; and the Refineries: Warri Refining and Petrochemical Company (WRPC), Kaduna Refining and Petrochemical Company (KRPC), and Port Harcourt Refining and Petrochemical Company (PHRC).

The ventures’ company includes medicals, property, pensions, shipping, and wheel insurance.

Kachikwu said: “The president has approved the final phase of the restructuring of the NNPC, under that phase it is not so much different from what we have now but we have restructured ourselves into four key business components: the upstream, which is what you used to call the Exploration and Production (E&P), the downstream, which is what you called the Commercial and Investment (C&I), the gas power market, which is basically a pullout from the E&P, the refinery group, which is basically the three refineries, and of course the ventures, which is every other small company here and there that did not have a sense of direction.

“Underneath these companies, we have a collective of 20 companies on the whole, where we had about 16 before, so only about four are new introductions. So it is not so much the size and we have not split NNPC into 30 companies, but there are four major divisional groups.

“Four or five are business focused, while others provide services. Beneath these five that are business-geared are the companies that are there. For example, with PPMC, we have taken the pipeline and depots unit and put them into a different company so that somebody focuses on that, while PPMC deals with the marketing of products.”

According to him, all the analysis done to date in terms of the number of staff is that we are overstaffed and the only way we can do this is to create work so that everybody who is in the system has something that they are doing and so that they get busy and earn money.

On the restructuring, he explained that “this took months of work with consultants to flesh that out”, adding, “The principle of our restructuring is that nobody loses work because the environment is just too testy for now to throw people out of work.

So nobody is losing his/her job, but people are going to get busy in the respective business units and it is a chance for anybody who wants to progress in his career and prove himself to rise up and get what he/she wants.

“It is a five business focused unbundling and they all report to the GMD and the whole idea is to focus everybody that it is no longer an administrative but business role. The group is going to become more nimble.”

Similarly, the minister who disclosed that Nigeria was working to end importation of petrol in the next 18 months, said it would cost about $500 million to get the country’s refineries back to full capacity.

Kachikwu said that the plan would be supported by his ongoing discussions with new joint venture partners to build refineries alongside the country’s four existing refineries in Kaduna, Warri and Port Harcourt.

He said it was a shame that the country imports most of its domestic petrol needs, and that by the time the plan comes to fruition, the country should be able to attain self-sufficiency in providing for its domestic fuel needs.

“The policy on the whole is that we must target a time frame or 12 and 18 months to get out of importation. It is not good for the country, it is not a good image, it does not create jobs and we lose tax when it comes to the government and creates a huge amount of, quite frankly, emotional backlash when people have to queue looking for fuel.

“We are working feverishly, trying to work with joint venture partners who can come in and work with us. We have advertised recently for co-located refineries and asking people to come and co-locate new refineries into our refinery premises so that they can share pipelines, tankages, and we are working hard to see that we can complete whatever refinery upgrade we are trying to do within the next 12 to 18 months.

“Obviously, for the co-located refineries which are the new ones, we are targeting to see that we are able to finish within two to three years and if we do that, we will have excess capacity of refined products and bear in mind that Dangote is also bringing on-stream his own refinery.”

Speaking to THISDAY on the rationale for the restructuring of NNPC, especially the creation of the 20 new companies or new business units (NBUs), Kachikwu said it was done to prepare them for private sector participation.

“As you know, we intend to concession or enter into joint ventures in respect to injecting new capital and the operations of some of these firms; so they had to be unbundled so the right sort of investors can come in with capital and expertise to turn them around.

“Also the rationale for the restructuring of the corporation stemmed from the fact that it had become unwieldy, so the aim is to create smaller units with deliverable targets that are easier to manage,” he said.

However, before Kachikwu’s announcement on the president’s approval of NNPC’s restructuring, the House of Representatives yesterday cautioned against restructuring it without an amendment to the Act which established the state run-oil firm.

The House recalled that the NNPC was established through the Nigerian National Petroleum Corporation, CAP N123, Laws of the Federation, 2004, adding that its structure could therefore only be altered, changed or otherwise amended only by an Act of the National Assembly.

Following a resolution sponsored as matter of urgent importance by the Hon. Jarigbe Agom Jarigbe (Cross River PDP), the House urged Buhari, who is also the Minister for Petroleum Resources, to urgently transmit an executive bill to the National Assembly, if he intends to unbundle NNPC or execute fundamental restructuring or reforms in the oil sector.

Jarigbe noted that since petroleum and natural gas are included in the Exclusive Legislative List (Item 39) in the Nigerian Constitution, “not even a presidential fiat can restructure it”.

He called for the condemnation of what he termed an executive legislation by Kachikwu to “unbundle NNPC into 30 different entities without legislative approval”.

“The minister’s pronouncement preempts the provisions of the proposed Petroleum Industry Bill (PIB), which has not been introduced in the Eighth National Assembly,” he added.

The matter was referred to the House Committees on Petroleum Upstream, Petroleum Downstream, Gas and Local Content and Legislative Compliance.

However, Kachikwu, in his defence, told THISDAY that NNPC has not been broken up or unbundled as erroneously reported, explaining that what the president approved was the restructuring of the corporation and there was nothing wrong with it as long as it was done within the confines of the law.

“NNPC has not be unbundled or broken up. It remains the same entity but with different units internally for enhanced efficiency and profitability. Besides, the NNPC Act allows for the restructuring of NNPC.

“It is the PIB that provides for the unbundling or break up of NNPC into separate units and that has not happened with what we have done,” he said.

President Approves NNPC’s Restructuring into Seven Units, 20 Companies

OPEC members now keen to end oil glut, says Kachikwu

The mood inside the Organization of the Petroleum Exporting Countries (OPEC) is shifting from mistrust to a growing consensus that a decision must be reached on how to end the global oil price rout, Minister of State for Petroleum Resources Ibe Kachikwu has said.

Managing Director of the NNPC, Mr. Emmanuel Kachikwu

Oil prices have slumped by more than 70 per cent to near $30 a barrel over the past 18 months as OPEC, led by top producer Saudi Arabia, sought to drive higher-cost producers out of the market by refusing to cut production despite a supply glut.

The price crash has crippled some economies that depend heavily on oil sales for income, such as Nigeria and Venezuela, and even Saudi Arabia is shoring up its resources to withstand the painful revenue drop.

“There’s increased conversation going on. I think when we met in December … they (OPEC members) were hardly talking to one another. Everyone was protecting their own positional logic,” Nigerian oil minister Emmanuel Ibe Kachiwku told Reuters in an interview.

“Now I think you have cross-logic … they are looking at what are the deficiencies, what is the optimum.”

Struggling oil producers have made repeated calls for an emergency OPEC meeting, but Kachikwu said that the timing had not been right. The cartel’s next regular meeting is in June.

“We haven’t been sure that if we held those (emergency) meetings that we could actually walk away with some consensus,” Kachikwu said.

“A lot of barrels are tumbling out of the market from non-OPEC members, so the Saudi philosophy is obviously working. But it’s not influencing the price higher, which means that whether we like it or not some barrels are coming in from … members and non-members to cover whatever is dropping out.”

The International Energy Agency said on Jan. 19 that oil markets could be oversupplied by as much as 1.5 million barrels per day in the first half of 2016 and warned that prices could decline further as Iran’s emergence from economic sanctions brings more crude to the market.

OPEC has declined to trim output without help from non-members, which so far have refused to participate. Russia, the world’s biggest oil producer, has played coy by floating the idea of a cut without saying whether it would participate.

In an attempt to find a compromise, Venezuela’s oil minister recently proposed a freeze on new production to place a cap on the growing glut while not requiring countries to surrender market share.

Kachikwu said that he would meet his Qatari and Saudi counterparts next week to discuss the situation.

“Have we got to the point where we can say there is a definite strategy? In terms of production reduction or freezing, no, I don’t think we have got there. But there is a lot of energy (behind the idea),” Kachikwu said.

“As you get closer to the statutory (OPEC) meeting dates … you are going to see a lot more people get active in those conversations and try to find solutions.”

OPEC members now keen to end oil glut, says Kachikwu