By John Ikani
The Nigerian National Petroleum Corporation (NNPC) has assured that it would protect the interest of Nigeria in any transaction involving International Oil Companies (IOCs) interested in divesting from the country.
NNPC Group Managing Director Mele Kyari, who stated this in Abuja at the opening ceremony of the 2021 Society for Petroleum Engineers (SPE) Annual International Conference and Exhibition, said the Corporation, plans to develop a comprehensive divestment policy for the IOCs operating in the country.
Kyari who noted that the move is to protect strategic national interest, said the NNPC cannot stop any of the oil concerns from deciding to sell off any of their assets as far as the rules are followed.
The NNPC boss was obviously speaking against the backdrop of reports at the weekend of plans by Royal Dutch Shell, to fully sell off its subsidiary, Shell Petroleum Development Company (SPDC) because the company’s future plans no longer align with the operations of the Nigerian subsidiary.
The company did not deny the planned sale, but said consultations were still ongoing, although still at the early stages.
Noting that such divestment could create challenges for stakeholders like the NNPC, Kyari spoke of the need to ensure that the right and competent investors are found, that will assume the ownership of the assets and be in a position add value to the industry.
He said: “We have engaged all our partners to ensure that while they have the right of divestments, that there should be no situation where this will become a waterloo of our industry.
“Therefore, NNPC will ensure that Nigeria’s strategic national interest is safeguarded by developing a comprehensive Divestment Policy that will provide clear guidelines and criteria for the divestment of partners’ interest.
“The Corporation would make clear distinctions between Divestment of Shares and Operatorship Agreements under various Joint Operating Agreements.”
According to him, the NNPC will also leverage its rights of pre-emption as well as evaluating the operational competence and track records of new partners.
He said attention would be paid to abandonment and relinquishment costs, severance to affected members of staff as well as third party contract liabilities.
He said the divestment was being driven by global energy challenges, making the IOCs to diversify their portfolios to low-carbon investments.
