Energy expert and co-founder of Dairy Hills, Kelvin Emmanuel, has said that 50% of the macroeconomic problems Nigeria is facing are from the Nigerian National Petroleum Company.
During an interview with ARISE NEWS on Friday, Emmanuel emphasised the critical role NNPC plays in Nigeria’s economic landscape saying that “it is time for Mr. President to take the bull by the horns and realise that 50% of the macroeconomic problems this country faces stem from the NNPC.”
Emmanuel expressed scepticism about NNPC’s operational claims, stating, “I’m only going to believe the NNPC in Port Harcourt refinery or any other government-owned refinery when I see the actual derivatives in trucks going out of the Port Harcourt refinery gate, and when marketers confirm that they have actually started.”
Highlighting the significant financial losses incurred over the past two decades, Emmanuel pointed out that “about 12 trillion naira has gone down the drain in turn-around maintenance with nothing to show for it.” He noted that this sum, when adjusted for exchange rates, is nearly equivalent to the $20 billion used by Dangote to build one of the largest refineries in the world.
Emmanuel also discussed the Domestic Crude Oil Supply Obligation (DCSO) under Section 109 of the Petroleum Industry Act of 2021. He questioned whether the NNPC and other stakeholders are adhering to these guidelines, particularly regarding the supply and security of crude oil for Nigeria’s refineries.
The expert criticised NNPC’s reliance on reserve-based lending, noting that the company borrowed $12 billion between 2019 and 2024, including a recent $3.4 billion loan through Afrexim Bank. He described the effective interest rates on these loans, which could be as high as 11%, as “very high,” and questioned why NNPC, with its substantial retained earnings, still needs to borrow money to invest in upstream operations.
Emmanuel further criticised the lack of accountability and governance within NNPC, arguing that the only way to improve the organisation’s efficiency is to take it public through an Initial Public Offering (IPO). He stated, “The IPO process is going to alter and change who has power to nominate a board, who has powers to appoint the management team, and it’s going to reflect the realities of the market more than it will reflect federal character and government appointments.”
He concluded by warning that without these significant changes, Nigeria will continue to face the same macroeconomic problems, particularly as they relate to the NNPC’s influence on the economy.
NNEOMA UDENSI
Follow us on:
