NNPC, Kyari and transparency
KEN UGBECHIE …gongbeat column
The Group Managing Director, GMD, of the Nigerian National Petroleum Corporation, NNPC, Mr. Mele Kolo Kyari, is a treasure trove of knowledge. Fecund and engaging, he is truly a journalist’s delight. He has vast knowledge of the nation’s petroleum industry. And it shows when you encounter him. I did penultimate week when the corporation played host to the Exco of the Nigerian Guild of Editors.
Kyari kicks with zeal. He’s effervescent and is not one to offer excuses when it comes to getting the job done. He inspires hope especially in an industry that has become the nation’s cash cow as well as the nation’s curse. NNPC sells Nigeria’s crude everyday. It’s a critical entity that must never be left in the hand of an apprentice manager. Kyari is not one. He’s a system’s man. A geologist, earth scientist and crude oil marketer of many years. This means he knows everything and anything about crude oil production. He can tell the soil texture that bears oil and gas. He can sniff crude oil and gas from the deepest part of the earth. Beyond that, he can also sell same. He understands the global market, its foibles, volatility and treachery. Yes, the global oil market is a treacherous one. It can hurt and heal. It can break and make. Some call it the Dutch Disease. Others allude to it as the Resource Curse.
Nigeria has been a victim of the “Dutch Disease” as well as the “Resource Curse. Both are symptomatic of monoculture economies where a nation relies heavily if not solely on crude cash. Whereas the ‘Disease’ leads to poverty in the midst of plenty, the ‘Curse’ tends to make a people lazy, uninventive and largely unresourceful. “The ‘disease’ kills agriculture and the primary industry; the ‘curse’ makes the people docile and uncreative. This explains why the most progressive nations of the world with robust economies and impressive income per capital are not the oil-producing nations or those relying chiefly on oil and gas money. Even now, the most capitalized companies in the world are not oil and gas multinationals but those who deal in digital knowledge.
Oil and gas is good business. It yields good profit, creates jobs and wealth. And because it is lucrative, it is also the hotbed of global corruption. Anywhere there is crude oil money, there is a high probability of graft. Russia, Venezuela, Angola et al have had their fair share of oil and gas corruption. The smell of oil is the stench of corruption.
Transparency International, the global corruption watchdog, puts it succinctly: “Many countries rich in oil and gas are home to some of the world’s poorest people. How can this happen? Too often, wealth stays in the hands of politicians and industry insiders. Revenues don’t get published. Payments made to governments to exploit resources remain secret. Bribery and embezzlement go unchecked.
“Many oil and gas companies protect the identities of their equity holders and subsidiaries. This allows corrupt leaders to hide stolen funds unnoticed. Inadequate financial statements make it easy to disguise corrupt deals, and impossible for any of us to monitor them. Many oil and gas companies don’t publish information country by country. This allows them to hide the royalties, taxes and fees they pay. But without this information, we can’t hold governments to account for the money they receive.”
That sums it up. There is a culture of lack of transparency in the global oil and gas industry. This paves the path for corruption to fester. Nigeria is no exception. Kyari knows this all too well. He alluded to it during the meeting with editors and in fact at every forum he has featured since assuming office.
Sure, Kyari is aware of the not-too-pleasant perception of NNPC in the eyes of the public. He’s aware of the sordidly poor state of our refineries. Shockingly, none of them is working at the moment, meaning Nigeria imports all of her petroleum products. The implication is that Nigeria pays more to get less. Again, Kyari knows this. More importantly, he knows what to do. He says he will fix the aberrations. He will get the refineries to work. He’s such a confident man. He would address issues of transparency and accountability. He says he will make NNPC to account to its owners: Nigerians. Grand vision, great mission. But Kyari is just one man. He can’t do this alone. He realizes this and he has solicited the collaboration of the media and Nigerians who are the shareholders in the business.
In his humility and simplicity of heart, he admits it thus: “For one, we probably haven’t been transparent with the public and we recognize this and promise that we’re going to be transparent. We’re also seen not to be accountable; we also promise that we’re going to be accountable to the shareholders of this company, which includes all of us and myself because NNPC is a company owned by all of us and so we all have the responsibility to make this company work.”
I agree with Mr. Kyari. Even the media has been complicit in the aberrations that signposted the oil and gas industry these past decades. And not just the oil and gas sector, in all aspects of human endeavour in the country. Politicians and public officials pillage the treasury because the media is usually steeped in selective amnesia resulting in selective reporting and analyses.
One reassuring noticeable trait of Kyari is that he’s not one to reel out excuses. He is more an activity man than the talk man. Nigerian public service fails because there are too many talk men within the ecosystem. Not this Kyari. “We’ll grow reserves for this country; there’s so much talk about growing reserves without activity. I don’t like giving excuses. We won’t give excuses,” he says.
NNPC is at the core of Nigeria’s economic buoyancy. It is an enabler. It is the custodian of the nation’s gas which in turn delivers power for homes and industries. Kyari says he and his team are focusing to deliver gas to power and gas to industry. From production of power to distribution to even recovering payments from consumers is a huge chain with multiple challenges. In his word, NNPC under his watch will play its part by increasing gas supply to power and industry so that our economies can grow.
More noteworthy, he has promised to open the NNPC books, publish details of its contracts and contractors, make the monthly financial and operations reports accessible to Nigerians and as much as possible, insulate the corporation from partisan politics.
These are lofty goals. Kyari’s experience as one who has sold the nation’s crude, as one who once represented Nigeria at OPEC and as one versed in the intricate engineering processes of oil and gas exploration and exploitation puts him at the cutting edge. He’s a man of grand vision; a square peg plugged into a square hole. But he’s no magician. He needs one and all to kick the refineries back to life and remodel the processes at NNPC to make it a smarter and more efficient entity. It’s a tough call but he looks well primed and preened to fix things. I wish him success.
Culled from Sunday Sun