•Stakeholders list hurdles before new board as oil production dips by 50,000 barrels
By Adewale Sanyaolu
The sack of the NNPC Ltd’s management led by Mele Kyari by President Bola Tinubu has ignited a blend of applause and criticism.
Stakeholders in the oil and gas sector have assessed the implications for the sector, especially with oil production dipping by 50,000 barrels.
They note that the new board, headed by Mr. Bayo Ojulari as the new Group Chief Executive Officer, faces a daunting challenge of navigating the prevalent turbulent times and steer the company toward growth and stability.
His major hurdle is raising Nigeria’s crude oil production in line with the mandate given by President Bola Tinubu.
Nigeria made the biggest oil production cut among members of the Organization of Petroleum Exporting Countries (OPEC) in March, reducing output by 50,000 barrels per day.
Experts have weighed in on the recent reconstitution of the NNPC management and board, offering varied perspectives on the move in interviews with the News Agency of Nigeria (NAN) on Wednesday in Abuja.
Mr. Olabode Sowunmi, an oil and gas expert, characterised the development as a strategic initiative to inject new life and energy into the industry.
Sowunmi, the Chief Executive Officer of Cabtree, welcomed the changes, noting that NNPC Ltd. operates as a limited liability company with the Federal Government as its major shareholder. He stated, “It is a calculated effort to put some life and energy into the industry. It is expected that this will mean new thinking, new focus, and more results.”
On the proposed Initial Public Offering (IPO) aimed at listing NNPC on the stock market, Sowunmi suggested that the CEO’s removal would not have been prevented by the IPO, as the government holds the authority to remove any appointed official at any time. “The government can remove any government appointee at any time,” he said.
Economic expert Yushau Aliyu called the timing of the changes appropriate, particularly as the IPO progresses. However, he stressed that the IPO should be approached professionally, factoring in the dynamics of the oil market and public willingness to invest. “The IPO must be professionally determined by relating to the development in the oil market as well as the willingness of the general public. Investment potential with the economic growth targets of Nigeria 2030 should also be considered,” he noted. Aliyu also highlighted the President’s authority under the Petroleum Industry Act (PIA 2021) to dissolve both the NNPC Ltd. board and the CEO.
Dr. Sand Mba-Kalu, another expert, argued that Nigeria’s oil and gas sector requires stability, predictability, and adherence to legal standards to attract sustainable investment and foster transformation. He suggested that the leadership changes could be part of a broader plan to meet Nigeria’s production and refining targets for the energy sector by 2027 and 2030. “This move represents a bold initiative within the larger framework of aiming to meet our national production and refining targets in the energy sector by 2027 and 2030,” he said.
An Economist, Mr. Lawrence Nze, expressed concerns over policies introduced under Kyari, which, in his view, failed to address key challenges in the oil sector. Nze pointed to the Naira for crude policy, which he felt had not led to significant price reductions. He argued, “The Naira for crude policy appeared not to be working since it had not resulted in any serious reduction in price.” He noted that the Dangote Refinery had made some progress by slightly lowering ex-depot prices, which in turn could influence pump prices, but the authorities had abruptly cancelled it. “To me, it looks like a sabotage against the people. Why can we not stop importation? It means that there is a deal that someone or a group of people are benefiting from.”
According to a Bloomberg report, Nigeria made the cut to maintain an average of 1.5 million barrels per day, in line with its OPEC quota, as the cartel urged tightened quotas among its members.
According to a Bloomberg survey, OPEC reduced overall production by 110,000 barrels per day in March. Tinubu, in appointing Ojulari, tasked the new board to elevate NNPC’s share of crude oil refining output to 200,000 barrels by 2027 and reach 500,000 by 2030.
The Tinubu administration is equally targeting to raise oil production to two million barrels daily by 2027 and three million barrels daily by 2030.
Meanwhile, the Crude Oil Refiners Association of Nigeria (CORAN) has reacted to the end of tenure of the immediate past Group Chief Executive Officer of NNPC Ltd, Mr. Mele Kyari, saying his period was marked with various reforms that supported the growth of the oil industry.
CORAN noted that Kyari’s exit was in tandem with civil service rules, having attained the age of 60 years.
Publicity Secretary of CORAN, Mr. Iche Idoko, told Daily Sun that his sack isn’t a big deal. “We have seen several NNPC bosses come and go. His sack signifies that the powers that be appear to have been okay with his contribution to the industry this far and it was time for him to leave,” he said.
CORAN, however, urged Ojulari to continue with the industry reforms, especially at this time when the industry needs a purposeful and forward-looking leader.
He said the new NNPC should ensure that oil production grows beyond the current levels while ensuring that the domestic supply of crude oil to local refineries is sustained.
In a similar vein, the Executive Secretary of Nigeria Extractive Industry Transparency Initiative (NEITI), Mr. Ogbonnaya Orji, said, “As a Supporting Company of the global Extractive Industries Transparency Initiative (EITI), NNPCL must demonstrate unwavering commitment to openness, systematic disclosure of critical industry data, responsible resource management, and corporate governance best practices.”
NEITI urged the new leadership to prioritize the timely publication of NNPCL’s financial statements, full disclosure of production data, operational costs, and revenue remittances to help rebuild public trust and enhance Nigeria’s global reputation.
“Transparency in the management of oil and gas revenues remains critical to national development and ongoing poverty reduction efforts. The EITI process provides a tested framework for ensuring that revenues from natural resources are prudently managed, fully accounted for, and efficiently deployed to address Nigeria’s development needs. We look forward to working closely with Mr. Ojulari and his team in deepening the NEITI-EITI process in Nigeria and ensuring that NNPCL continues to align with international best practices in corporate governance and financial transparency,” Orji affirmed.
NEITI also congratulated the newly reconstituted NNPCL Board and charged them to provide forward-looking strategic direction to fast-track the ongoing transformation of NNPCL in line with the PIA.
NEITI added that the Board’s role in ensuring that NNPCL remains accountable to its shareholders—the Nigerian people—is crucial to the long-term sustainability of the company and the industry at large.
Orji thanked the Mele Kyari team for their dedication and hard work. “On behalf of the NEITI National Stakeholders’ Working Group, we extend our appreciation to the outgoing GCEO, Mr. Mele Kyari, for his mutual respect, patience, and collaboration with NEITI over the past six years.
His tenure was marked by significant engagements with NEITI in advancing corporate transparency, public disclosures, and aligning NNPCL with the global EITI framework.
We commend his service to the nation and wish him success in his future endeavors.”
He added that NEITI remains committed to its mandate of ensuring transparency and accountability in Nigeria’s extractive sector and will continue to support all efforts aimed at making NNPCL a globally competitive, accountable, and efficiently managed national oil company.