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FG to set up Asset Management Company for NNPC

By on January 7, 2013

NNPC Tower

With a view to bringing accountability, transparency, efficiency, productivity and strategic leadership direction into the Nigerian National Petroleum Corporation (NNPC), the Federal Government is planning to set up an asset holding company for number one oil firm (NNPC)

This has been viewed as part of the provisions of the Petroleum Industry Bill (PIB) which is at the point of being passed into law.

For about a decade, the operations and activities of the corporation, has been smeared by revelations of corruption, inefficiency, poor documentation and auditing of operations and activities.

Under the plan, Assets of the Corporation like National Petroleum Investment Management Services (NAPIMS); and the Nigerian Gas Company (NGC) will be given up by 30 percent equity for private investors.

The Decision which is in line with the new framework and policy guideline contained in the PIB, is to also shore up funds for the Nation’s Oil and Gas Industry and also create a platform for more Foreign Direct Investment and Technical Assistance.

Part of the Industry Bill Provisions and Framework is to achieve the following:

-To Promote Nigerian Local Content Development.

– To Guarantee Health and Safety environment for areas that are exposed to heavy drilling and exploration activities.

– To make the Oil and Gas Sector competitive and attractive.

– To create a competitive business environment and to create a fiscal framework that is flexible.

Speaking on the development by a top NNPC Official, he said part of the plan for the Asset management of the NNPC, was drafted from a Comparative analysis of the success of the operations of State Oil Firms like Petrobraz(Brazil) and Petronas (Malaysia) which have moved the inefficient and incompetent state corporation to viable commercial entities.

It will be recalled that Petrobraz in the year 2010 achieved a high asset value of over $75 billion, making it the highest valued State Oil Corporation in the Globe. This was achieved through implementation of the Privatisation of major assets of the Corporation.

The NNPC top Official also asserted that the Asset management of NNPC was necessary, as it will create opportunities for viable capital projects and investment opportunities, for the overall interest of the Nation.

One Comment

  1. Ronnie Alfred

    April 22, 2013 at 10:08 am

    The key-figure here is how we can have good asset management with the following points below:
    – Good structures of organization
    – Specific analysis for plan and budget
    – Good assessment and determination.
    The case above is a good sample to learn. Thanks for the articles with specific explanation.