Crux of the matter

By The Nation

•Refineries’ TAM should not be done at public expense again

Appearing before the House of Representatives Committee on Petroleum (Upstream) in Abuja on July 14, the Group Managing Director of Nigerian National Petroleum Corporation (NNPC), Melee Kyari, went on an odyssey of dissecting the ails afflicting the nation’s oil industry, as all NNPC executives before him had done.

He blamed the moribund state of the country’s refineries on lack of proper maintenance of its facilities over the years.

The national oil corporation, he said, could boast “of the highest number of technicians in the petroleum sector in the world” yet suffered the tragedy of not being “adequately engaged”.

On the technical capacity of the NNPC to properly manage oil exploration, refinery and sales, he said: “I can say that in the entire global oil and gas industry, there is nowhere you would have gone that you would not find a skilled Nigerian working in the oil and gas industry. And indeed, we are probably the largest contributor to skilled manpower in the industry, of all the black nations of the world.”

Echoing a similar refrain on the moribund refineries, he said: “The refineries didn’t fail because there were no skills. They failed because we are unable to take care of the refineries.” And then he added – apparently oblivious of the inherent paradox – ‘But what we have decided to do is to make them work. There is no scarcity of skilled people”.

Few Nigerians will disagree with the NNPC boss over the latest diagnosis of the problem. Fact is, they are issues that most Nigerians are already familiar with. However, claims of a surfeit of talents and expertise that should ordinarily make her the envy of other national oil corporations but are otherwise “not adequately engaged”; and the issue of lack of structured maintenance programme for the nation’s refineries, are at best, the symptoms of deeper structural anomalies inherent in the nation’s oil industry. They merely provide the foil for the other story less told: the role of the Federal Government in the unmaking of the nation’s oil industry.

Courtesy of government’s overbearing influence, NNPC has long presented itself as a good example of how a modern business entity – public or private – is not supposed to be run. So long as the liquid gold and petro-dollars flowed, it would seem that nothing else mattered. Far from being a world-class entity driven by technology with precise operational timelines and deliverables, what we have is another appendage of government with projects and programmes driven more by political interests than technical feasibility.

For a corporation that has neither grasped its essence nor justified its rationale in its nearly 60 years of existence, Nigerians need no further reminders on the route not taken; seeing their tell-tale evidence in the obsolete, ill-maintained pipeline network, the moribund refineries and the endless Turn Around Maintenance (TAMs), which rather than deliver value has instead become a huge drain on the nation’s resources, is more than enough.

Surely, Nigerians understand the enthusiasm of the current NNPC helmsman to make things happen; the truth however is that the country has been so long on the same route than to expect that things would somehow end up differently.

In 2015, Ibe Kachikwu as GMD-NNPC told Nigerians that the refineries were as good as scraps only to recant in deference to the moods in the presidency. Kyari, the current helmsman has taken the refineries sing-song a notch higher: the NNPC can and should fix the refineries – ostensibly with public funds.

This time around, we disagree. Should the corporation feel the need to go ahead, this must be done without a dime of public funds. In any case, we ought by now, to be seeing evidence of concrete steps being taken to dismantle the dysfunctional behemoth as a first step to overhauling it for efficiency and transparency.

 

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