by Dele Momodu
Fellow Nigerians, I have been greatly troubled by the spate of criticisms and vicious attacks against the Buhari government. You cannot blame me. I was one of those who went all out to campaign for the change movement. Naturally, we must take credit for whatever success President Buhari achieves and face the public odium for its failure, God forbid. My fervent prayer had been that Buhari will not fail because the disgrace would be too monumental for some of us.
I decided to go on a solo rescue mission hoping to make my modest contribution in the process. What I discovered through my interactions with some of our leaders is that majority have been too scared of talking for whatever reason. My unlettered mum used to tell me a Yoruba adage that “lack of effective communication is the beginning of foolishness and backwardness.
I have since had the opportunity of chatting hither and tither with some of the key cabinet members, officially and unofficially and realised that this government should jettison propaganda and let each Ministry provide its road maps to Nigerians. For example, Mr Babatunde Raji Fashola is a super technocrat who has been saddled with so much. After our one hour long telephone conversation, he allayed my fears substantially on the intractable power problems in our country. He is meticulously plotting his paths through the labyrinth of electrical wilderness. Very soon, he believes, we shall enjoy some relief. He is not someone to be fazed on intimidated by daunting challenges.
Rt. Hon. Chibuike Rotimi Amaechi is another Minister in charge of one of the most essential sectors of our economy, transportation. In the last few weeks, he’s been able to breakdown his plans and activities. I was very impressed when he acknowledged the foundation laid by former President Goodluck Jonathan and how the Buhari government would work assiduously to bring our transportation to its most modern level ever. His ideas are ambitious but practical.
I have been mostly worried about the petroleum sector. The long queues have returned with a vengeance. The price of oil has fallen globally and our fattest cash cow has been growing leaner. Dr Ibe Kachikwu is a brainbox I have known for decades. They don’t get better than him in that industry. What then is the problem? To change any system is not always very simple. Those who used to make easy money would do anything and everything to frustrate the changer. My probe revealed some of the obstacles militating against this government but slowly and steadily hope is rising.
Change is in the air. Although it has been slow in coming it is gratifying to note that the patience of the longsuffering Nigerian masses, especially in the area of delivery of petroleum products is going to be rewarded after all. I’m willing to wait a little more for the magic wand to blossom.
President Muhammadu Buhari has never hidden the fact that apart from the security situation and the fight against corruption his major love is to reproduce his feats in revamping the petroleum sector in respect of which he had two bites at the cherry, firstly as Commissioner for Petroleum under the military administration of General Olusegun Obasanjo between 1976 and 1979 and more recently as Chairman of the Petroleum Task Force (PTF) under President Olusegun Obasanjo. As it was one of the first acts of his present administration was the appointment of Nigerian and Harvard trained Dr Ibe Kachikwu as Group Managing Director of the Nigerian National Petroleum Company (NNPC). Kachikwu’s appointment was hailed as all those who know him as a first rate appointment and one likely to sanitise the petroleum sector after the tales of corruption and mismanagement that we had been regaled with. When Kachikwu was later appointed as Minister of State in the Ministry of Petroleum Resources thuds being the first person to combine the dual roles of Group Managing Director of NNPC and Minister no one batted an eyelid as Kachikwu had already distinguished himself as an astute manager of this depreciating national economic pillar and a savvy administrator capable of utilising and maximising the use of scarce resources.
It is also a demonstration of the fairness and objectivity of Dr Kachikwu that he has been quick to accept that some of the groundwork of what he has been doing at NNPC and the Ministry of Petroleum Resources was laid by previous administrations. However what he has excelled in is to bring his vast array of talents and contacts to bear in taking the NNPC to the next level by insisting that things must work rather than just jettisoning them. Thus he has intensified work on preserving the security and integrity of the pipeline network by combining more traditional methods of manual security with proven scientific methods. The result is that our pipelines are becoming more secure and we will soon begin to see the changes that have been rung.
In agreement with President Buhari that we cannot have refineries and still be importing petroleum products Kachikwu has gone to great lengths to oversee the revival of the ailing refineries in the country. It is clear that the Minister of State for Petroleum Resources has taking the President’s marching orders to heart and he has definitely been making giant strides in this respect.
“For the first time, Nigeria’s refineries are now ready to work”, Dr Kachilkwu said at a press briefing on Tuesday. “For the first time, our refineries are ready now to work. Crude has been pumped from Brass to Port Harcourt. Pipeline is being used for the first time in six years. For the first time we are able to pump to Ilorin, we have not done that in 10 years.”
The Minister of State also said that NNPC has saved Nigeria N1 trillion in what would have been subsidy payments and a further $1 billion under an efficient and effective importation programme which he has put in place. He has also listed some other achievements in the petroleum industry in the short period of time that he has taken command of the sector.
He said the change at NNPC is only just starting, adding that NNPC which should ordinarily be a cash cow but has been seriously haemorrhaging in the past will be delivering profit in two to three months. He expatiated by stating that from the innovative trend of publishing reports on the Corporation’s activities Nigerians would see that the Corporation has gone from an average deficit of over N30 billion to N3 billion in a period of six months.
Dr Kachikwu added “If you continue on this tangent, this company should continue to show monthly profitability in two to three months. That would be dramatic, and that is even before we have even started – because we haven’t started.”
Looking at specific initiatives that Dr Kachikwu has deployed, the Direct Sales-Direct Purchase (DSDP) initiative seems to be one of the most dramatic. Kachikwu modestly attributes the adoption and unqualified success of DSDP to all Nigerians who through their suggestions and concern led to him and his team coming up with the final concept of DSDP. DSDP was adopted to replace the much maligned and abused Crude Oil Swap and the Offshore Processing Arrangement (OPA). The aim was to reduce corruption and introduce and entrench transparency into the crude oil for product exchange transactions carried on by the Corporation. To achieve this, the bidding process has been thrown open. In addition, because the assessment process is transparent and is based on the global and or national track record of performance of the respective bidding companies, the influence of the Minister or GMD of NNPC is greatly reduced. The effect is that bid winners are selected on merit rather than on the basis of ‘man know man’ so that the entire process can now be said to fully comply and be in tandem with global best practices.
Before the advent of DSDP, crude oil was exchanged for petroleum products through third party traders at a pre-determined yield pattern. However the DSDP option eliminates all the middlemen and gives the NNPC control of the sale and purchase of crude oil with its partners with the expectation that the initiative would save the Country at least $1 billion annually. In effect the policy is aimed at reducing the gaps inherent in the OPA and the losses incurred by the NNPC in the past.
Another positive outcome of the new arrangement is that it would help the country to grow indigenous capacity in the international crude oil business and generate employment opportunities for indigenous companies because the Minister is determined to encourage fellow Nigerians by ensuring that they are selected to participate in the initiative albeit through the transparent process that has been evolved.
The DSDP initiative also gives other government agencies such as the Bureau of Public Procurement (BPP) and the Nigeria Extractive Industry and Transparency Initiative (NEITI), the opportunity to be a part of the bidding process in order to engender adherence to due process.
Notably Dr Kachikwu has implemented a price modulation policy which has rid the Federal Government of the burden of subsidy on imported petroleum products since January 2016. As Dr Kachikwu said on Tuesday “Look at the fact that with the removal or connivance on the removal of subsidy cost, you are saving the nation N1 trillion. For the first time this organisation is not worrying about where to get the next subsidy money or who is going to pay it.”
“But imagine what it looks like if you succeeded in identifying and doing all those. Imagine what it would look like if every business unit followed the same principles and monitored cost at those various levels.” For this reason Kachikwu has gone forward to unbundle the monolithic NNPC and established 5 profit units as separate entities with two further administrative units which owing to their very nature are supportive of the entire organisation.
Kachikwu said that for the first time, NNPC has met up with 75 percent of its responsibility to the federation account, highlighting the new ways of the corporation.
“This is simply through your 20 fixes; you deciding to cut costs, and to watch your expenses and there’s still a huge amount of expenses you still need to cut. ”
There is definitely more to come from this man as he next targets the elimination of the perennial fuel scarcity in the country.