President Umaru Yar�Adua on Monday passed a vote of no confidence in the Nigerian National Petroleum Corporation
Yar�Adua, at the opening of the eighth edition of the Nigerian Oil and Gas Conference in Abuja, said the NNPC had derailed from the objective for which it was established.
He attributed the loss of focus to what he described as �the paucity of the policy, regulatory, operational, fiscal and managerial framework that govern the country�s oil and gas industry.�
The President, who sat at the high table with the Group Managing Director of the NNPC, Alhaji Abubakar Yar�Adua and the three ministers of Energy � Mr. Odein Ajumogobia (Petroleum), Chief Emmanuel Odusina (Gas); Mrs. Fatimah Ibrahim (Power) � said it was sad that the corporation had been unable to play its statutory roles in the oil sector.
He said, �Our national oil company, NNPC, has been made, over the years, to assume multiple, and often times conflicting roles, including those of policy formulation, regulation, commercial operations, and national assets management.
�This has adversely affected the corporation�s capacity to effectively perform its primary role as an internationally and fully � integrated commercial oil and gas company.�
The worst, according to Yar�Adua, is the fact that �the last few decades had witnessed sister national oil companies, including those from OPEC(Organisation of Petroleum Exporting Countries) effectively competing against the international oil companies in all spheres of the industry, including certain significant operations of the industry beyond their national boundaries.�
He also expressed concern that even with the signing of the Joint Operating Agreement between the NNPC and the International Oil Companies, the NNPC had been unable to assume �operatorship� of oil fields like other national oil companies.
The President said, �Except for a few small fields being operated by the National Petroleum Development Company, this aspiration is yet to be attained in any appreciable manner.
�Successive managements simply grappled with our core obligations in these ventures.�
He added that it was worrisome that �an industry that had operated for about five decades, like the Nigerian oil and gas sector, still suffered from funding problems, perennial shortfalls, especially in funding of upstream operations that have constituted great obstacles to the timely growth and development of the industry.�
Stressing that it was �imperative that we tell each other a few home truths,� Yar�Adua added, �We have paid a very limited focus to the management and utilisation of our hydrocarbon resources.
�The enormous potential of oil and gas for generating economic growth, transferred technology, and providing a strong foundation for the transforming of our industrial and agricultural sectors have never really been fully exploited.
�There is no better evidence of the narrow focus than our nation�s power sector. Our story is that of a nation with legendary gas reserves, but remains stagnated with dismal power situation that has stunted the nation�s economic growth.
�The situation is not any better when we look at the other aspects of the energy industry. The provision of petroleum products, including PMS, AGO and LPG are dependent on importation.�
He said that the most glaring evidence of the shortcomings of the management of the oil and gas sector was in the area of the provision of petroleum products.
�The refineries, pipelines and depots have remained in very bad shape and disappointingly epileptic capacity utilisation to the extent that the nation is now dependent wholly on products importation,� Yar�Adua said.
The President also regretted that Nigeria, a leading force in gas in the world, �is not only unable to meet its entire domestic demand but that of other contiguous nations.�
He stated that the shortcomings underscored his administration�s reforms efforts in the oil sector.
�The situation cannot and should not be allowed to continue any longer,� Yar�Adua said, adding that his government approved the implementation of the new national oil and gas policy.
The President said, �The committee to restructure the industry has had a series of consultations with the major stakeholders whose contributions are being considered and would assist in shaping the new policy.
�This effort will culminate in the drafting of a Petroleum Industry Bill to be brought before the National Assembly in the next few months.�
The conference had in attendance, the main stakeholders in the oil industry, including two NNPC coordinators � Chief Sena Anthony and Mr. Mohammed Barkindo.
The Strategic Adviser to the President on Energy, Dr. Relwan Lukman, also attended the events