Featured Notes Owei Lakemfa

Govts incompetently running NNPC deserve the Nobel prize

THE latest episode in the Nigerian drama of governance is the importation of at least 100 million litres of contaminated PMS which knocked car engines.

As with such cases of governance, nobody, official or organisation is willing or honest enough to take responsibility.

The Nigerian National Petroleum Company, NNPC, which claimed to have discovered the contaminated fuel on January 20, 2022, has for 24 days now, been unable to bring the situation under control leaving chaos at fuel stations, and the economy limping.

However, it has been busy trying to pass the buck. Its Group Managing Director, Mr. Mele Kyari, named four entities; MRS, Oando, Duke Oil and a consortium consisting of Emadeb/Hyde/AYMaikifi/Brittania as being the culprits. Oando denied while MRS pointedly accused the NNPC of being responsible.


The joke is that Duke Oil is a subsidiary of the NNPC while the same NNPC established the Emadeb consortium in May 2021. As the sole importer and supplier of fuel in the country, the bulk stops at the NNPC’s table.

So when the House of Representatives charged the same agency to discipline the culprits, it could be nothing but a joke; how do you ask the NNPC to call itself to order? It is like President Muhammadu Buhari who doubles as Petroleum Minister promising to get to the bottom of the problem; we know what it is, the NNPC is the problem. In the eyes of the National Assembly, the NNPC is a rogue organisation that operates outside the law with impunity.

The Senate in October 2021 at the public hearing on the 2022-2024 Medium Term Expenditure accused the NNPC of ever being on a spending spree, illegally deducting monies from the federation account and refusing to pay its excess revenue into the Consolidated Revenue Fund.

 Just on January 26, 2022, the Nigerian Governors Forum, NGF, at a meeting with labour leaders in Abuja, accused the NNPC of being a fraudulent agency with opaque intentions. It also accused the body of mismanaging proceeds accruing to fuel subsidies. In 2012, the House of Representatives in verifying and determining “the actual subsidy requirements and monitor(ing) the implementation of the Subsidy Regime in Nigeria” established that the NNPC brazenly violates the constitution by illegally withdrawing funds from the federation account.


Examples of these include the fact that while the Central Bank in 2009 paid the NNPC N81.648 Billion as a legitimate subsidy, the corporation additionally deducted for itself, the sum of N408.255 Billion. While the NNPC was paid legally N402.423Billion in 2010, it helped itself to an additional N407.801 Billion. In 2011, the NNPC was legally paid N844.944 Billion while it illegally paid itself an additional N847.942 Billion. Again, it was discovered that while the then regulatory Petroleum Products Pricing  Regulatory Agency, PPPRA recommended that the NNPC deduct N540.419 Billion in 2011, the NNPC helped itself to an additional N285.098 Billion.

Theoretically, it is impossible for contaminated fuel to be sold at fuel stations because there are about a dozen check points to ascertain product quality. This begins from the point of importation. These include NNPC quality control agents and independent laboratories by independent marketers. There are also various government agencies like the Standard  Organisation of Nigeria, SON, which  is the sole statutory agency vested with the powers of “standardising and regulating the quality of products in Nigeria.” There are many government agencies like that of Consumer Affairs that are culpable in this contaminated fuel importation scandal. But I am willing to exonerate the Customs and Excise. Yes, this agency operates in all ports and borders of the country with the statutory charge of supervising all goods imported into or exported out of the country, collecting Import and Excise duties, and should, therefore, be involved in monitoring imported petroleum products, but its experiences dictate it should turn a blind eye.

The Customs exercised the issuance of clearance to discharge or authority to unload petroleum products with the quantities stated. But to perpetrate fraud, a dozen years ago, the petroleum product importers rather than discharge products on the Nigerian waters, stayed outside it to discharge the products from so-called Mother ships into Daughter vessels.

In order to verify the quantities carried by these so-called Mother vessels, Customs officials went to make verification. But their vessel came under the fire of the importers and some Customs officers were killed. Rather than investigate these murders and take a strong stance, Government officials advised the Customs not to check ships carrying fuel. Subsequently, the Federal Ministry of Finance and the Central Bank issued circulars to the Nigerian Customs not to inspect PMS imported by the NNPC.


 The NNPC is so attractive that any incumbent President must be its supervising minister. This reflects in its self-congratulatory arrogance, emptiness and gross incompetence. Nigeria began the commercialisation of oil 66 years ago, but until today, foreign companies are at the core of oil production in the country and the NNPC does not know how many litres of oil the country produces daily or how many are stolen. Although the country’s foreign earnings are dependent on oil exportation, the six petroleum exportation terminals in the country are owned by foreigners who do not owe allegiance to the country; Shell owns two, while the rest four are owned by Chevron, Texaco, Mobil and Agip.

The NNPC is so inept that while running four big refineries, it can neither refine petroleum products nor successfully import and distribute the products. Despite the corporation’s marked inability to carry out its basic functions, the Federal Government under its Road Infrastructure and Refreshment Tax Credit Scheme  on  October 27, 2021 awarded it contract to reconstruct  21 roads at the cost of N621.2 billion.

The NNPC and its parent Petroleum Ministry expose Nigeria to the international ridicule of being averagely, amongst the ten highest oil producers in the world but incapable of refining even a litre for local consumption. The disgrace is more magnified by the realisation that Belgium, the country from which the contaminated fuel was imported, is not oil-producing! This level of foolhardiness is unheard of in contemporary world history. This is so much that we need to approach the Nobel Prize Committee to institute a prize for the most incompetent and decidedly most injudicious management of resources. The contaminated fuel when poured into a clean bucket is like the Nigerian democracy; the sludge at the bottom are the local governments, the finer parts in the middle are the state governments while floating aimlessly on top is the Federal Government; when poured into the Nigerian vehicle, they knock the engine. Anybody who does not know that the Nigerian democracy is a knocked engine that needs to be overhauled or replaced should go back to sleep.

  • Owei Lakemfa is a veteran journalist and labour activist

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