Abuja, Nigeria | Xinhua | Nigeria has transformed the state-run Nigerian National Petroleum Corporation (NNPC) into an independent and limited liability firm, about 45 years after the creation of the national oil corporation.
The move is part of the ongoing reform of the country’s oil industry, heralded by the Petroleum Industry Act (PIA) signed into law last year by President Muhammadu Buhari.
On Tuesday, Buhari unveiled the new Nigerian National Petroleum Company Limited (NNPC Limited), which replaced the now defunct NNPC, at a ceremony in Abuja, the Nigerian capital.
He said Nigeria is transforming the petroleum industry to strengthen its capacity and market relevance for the present and future global energy priorities.
“This is a landmark event for the Nigerian oil industry,” Buhari said, noting that as a limited liability company, the new NNPC Limited is now mandated by law to ensure that Nigeria’s national energy security is guaranteed.
The new NNPC Limited will operate independently, devoid of bureaucratic tendencies. This, according to industry experts, will boost the new national oil company with increased expectations around active engagement with stakeholders, regulatory compliance, and more significantly, accountability.
Buhari, who also doubles as Nigeria’s minister of petroleum resources, expressed optimism that the NNPC Limited, which he described as “Africa’s largest national oil company,” would further support sustainable growth across other sectors of the economy as it delivers energy to the world.
“Our country places a high premium on creating the right atmosphere that supports investment and growth to boost our economy and continue to play an important role in sustaining global energy requirements,” Buhari said.
According to the Nigerian leader, the provisions of the Petroleum Industry Act give the Nigerian petroleum industry a new impetus, with an improved fiscal framework, transparent governance, enhanced regulation, and the creation of a commercially-driven and independent national oil company.
The new national oil company, he said, will conduct itself under the best international business practices in transparency, governance, and commercial viability.
Minister of State for Petroleum Resources Timipre Sylva told the ceremony that with the signing of the Petroleum Industry Act, which assures international and local oil companies of adequate protection for their investments, the nation’s petroleum industry is no longer “rudderless.”
The Nigerian government has created a more conducive environment for the growth of the oil and gas sector, and addressed legitimate grievances of communities most impacted by extractive industries, the official said.
“While the country was waiting for the PIA, Nigeria’s oil and gas industry lost about 50 billion U.S. dollars worth of investments,” Sylva said, noting that the Nigerian government has finally set all those woes behind, and a clear path for the survival and growth of the petroleum industry has now been created.