NNPC headquarters

President Muhammadu Buhari will, today, Tuesday, 19 July 2022, unveil NNPC Limited (NNPCL) at noon in Abuja. Thus, a new commercial juggernaut will roll into town. The new company will be a big departure from the petroleum products entity, established in 1977, 45 years ago. In other words, the NNPC will transform into a fully commercial entity today, which means the federal government would henceforth halt all forms of funding for its projects.

As disclosed last night by Mallam Mele Kyari on Channels, the new NNPC which would now operate as a limited company will go for an Initial Public Offer (IPO) by June 2023 to boost its capital base. He added that with a N200 billion initial capital outlay as well as $5 billion initial debt funding, the new NNPCL would “be one of the most efficiently run entities globally.”

Kyari revealed that the boilers of the Dangote refinery would be fired in the first quarter of 2023, a development that will help Nigeria’s “foreign exchange supply situation.”

He added that at the infant stage now the NNPCL would still be largely owned by the federation, but that the new company “will no longer require the approval of the executive or the National Assembly to borrow or seek financing for projects.”

In his words: “There is a space for private people to take equity in this company. But as we speak now, the shareholders are over 200 million Nigerians. There can be a second level of private ownership, that is by selling down some of these equities so that people can take it in their individual capacity not in the collective capacity as a nation.

“So definitely the whole gamut of the changes will happen. And this company must be IPO ready immediately before you can talk about selling down of interest,” Kyari stated.

“We’re already on the positive trend and by the middle of next year, I’m very, very confident that this company will be in a place to say we’re ready for IPO and the nation will decide to go private completely in the sense that we can now sell their equity, which is different from being owned by the generality of Nigerians,” he explained.

“What that means is that the NNPC must now look for financing without recourse to the state. And indeed, the law is very, very clear that we will have no recourse to public funds.

“We cannot go to the government anymore for financing. The reason is very simple we can no longer ask for a sovereign guarantee anymore. So the sovereignty vanishes,” he explained.

“Firstly, refineries, and then filling stations they’re the least of our assets. Although I agree that they are the most visible of our assets,” he stressed, adding that the real business is upstream.

“I’ve seen over a billion $5 billion of loan or financing. And the key information we have from those partners are looking, we know what you are, we know what you’re doing, we trust you and this is great for our company and our country,” he noted.