The Gas Aggregation Company Nigeria Limited (“GACN”) attended the official transitioning of the Nigerian National Petroleum Corporation (“NNPC”) into a limited liability company on Tuesday, 19th July 2022 at the banquet hall in Abuja, attended by the acting MD, Mr. Chijioke Uzoho. President Muhammadu Buhari while formally unveiling the new NNPC emphasized that he was privileged to sign the PIA in 2021 and the transformation of the Petroleum Industry will strengthen the growth of the new company. The leadership of NNPC and other dignitaries were all in attendance. The Minister of State for Petroleum Resources, Mr. Timipre Sylva in his speech said, the new NNPC is a new vintage for partnership while the CEO Mallam Mele Kyari added that the new company would be managed like a private sector enterprise and is expected to become more efficient in its operations.
NNPC was established on 1st April 1979 under the statutory-decree No 33 by a merger of Nigerian National Oil Corporation (“NNOC”), with its operational functions and the Federal Ministry of Mines and Power with its regulatory responsibilities. NNPC is a major player in both the upstream and downstream sectors. Its products include crude oil, gas, petroleum products and petrochemicals, products transportation as well as marketing.
On 16th August 2021, the (Petroleum Industrial Bill) PIB was signed into law which became PIA (Petroleum Industrial Act), the PIA is an act that will regulate the oil and gas sector. It will lead to a drastic transformation in the sector by attracting huge investment and collaborations within the sector.
The Nigerian National Petroleum Corporation on 19th July 2022 was formally unveiled as Nigerian National Petroleum Company Limited by President Muhammad Buhari, which means the status of the corporation has changed and it will be run as a limited liability company, whose operations will run in compliance with the provisions of the companies and the Allied matters act (2020).
The transition indicates among others but is not limited to:
- The new NNPC will be a commercial entity thereby having new operational structural changes and transformation.
- It will be a profit-driven entity, by providing a more productive fiscal, commercial and regulatory framework to support competition and investment by creating a fully commercial entity.
- The new NNPC will declare dividends to its shareholders and retain 20% profit which means the Nigerian populace can also invest in the company.
- The new structure of the company will strengthen and boost the interest and confidence of investors while attracting foreign direct investment to the energy sector.
- It will Increase the revenue of the Federal Government by paying its share of all fees, royalties, oil shares and taxes.
- The new NNPC will list its shares on the stock exchange mid 2023 according to its Group Chief Executive Officer Mallam Mele Kyari.
- The new company will no longer bear the burden of petroleum subsidy but will continue to support in supplying petroleum products to the Federal Government at a commercial value.
- The new company will be IPO (Initial public offer) ready which means that you have the system processes and a company that can account to its shareholders and stakeholders.
- As a commercial entity, the company will no longer contribute to the Federal account but pay taxes and royalties to Federal Government and divided to shareholders and deliver value to 200 million shareholders.
- The new company will be free from institutional regulations such as treasury single account.
- The new NNPC is incorporated under the Companies and Allied Matters Act to be known as NNPC Limited.
Gas Aggregation Company Nigeria (“GACN”) in line with its new objectives and mandates is also on its way to transitioning in to a limited liability company, with a change in its operational and structural changes to reflect the change. GACN can leverage on and replicate its major shareholder and stakeholder, NNPCL in its transitioning phase within it space and limitations, there by having more value-added commercial engagement and partnership with the new NNPC.
