’s struggling oil giant will be unbundled into independent “profit-making” companies – each with their own Managing Director – in the weeks ahead, according to the Minister of State for Petroleum Resources and NNPC Group Managing Director Emmanuel Ibe Kachikwu.
Having resisted the pressure to sell, the government has opted instead to implement a reform package and split the group 30 ways to tackle corruption and stem the company’s losses.
“Titles like group executive directors are going to disappear and in their place you are going to have chief executive officers and they are going to take responsibilities for their titles, said Kachikwu in a . “At the end of the day, the CEO of an upstream company must deliver an upstream result.”
Oil Minister Kachikwu stressed that his government has started work on resolving the governance issues striking at the heart of Nigeria’s . The focus will fall first, he said, on simple governance issues that can be easily righted before he and other reformers set about instrumenting a complete overhaul of the company – the first in over 20 years.
Formerly of Exxon Mobil, Kachikwu was appointed head of the NNPC last year and has vowed to tackle corruption and return the company to winning ways. The oil price collapse means the situation is more challenging than it otherwise would be, although the government is optimistic that the price will rise to around $50 per barrel.
According to Kachikwu, by June or July the oil company will be in a position where it can turn a profit for the first time in 15 years. However, the return to profitability is only the start, and an enthusiastic Kachikwu told that the changes could mean Nigeria’s oil and gas sector will finally be able to compete on a global scale.
In order to do so, he said, all stakeholders in the upstream, midstream and downstream sectors need to be on the same page on cost control, contracting circle, technology and environmental issues.