AfrOil: Nigeria establishes NNPC Ltd as new NOC

Nigerian President Muhammadu Buhari has issued an order authorising the incorporation of Nigerian National Petroleum Corp. Ltd (NNPC Ltd), in line with Section 53(1) of the recently signed Petroleum Industry Act (PIA). This act lays the groundwork for the new company to replace an existing state-run entity, Nigerian National Corp. (NNPC) as Nigeria’s national oil company (NOC).

Femi Adesina, Buhari’s special advisor for media and publicity, said in a statement that Adesina also noted that Buhari had approved the appointment of the new company’s board members and management, in line with Section 59(2) of the PIA. NNPC Ltd’s chairman will be Ifeanyi Ararume, a senator from Imo State, while NNPC’s current group managing director Mele Kyari will serve as CEO, he said. Umar Isa Ajiye, the CFO of NNPC, will hold the same position at NNPC Ltd, he stated.

NNPC Ltd will be a corporation and not eligible for direct state funding. This represents a departure from past practice, as NNPC has previously served effectively as an arm of the government. Officials in Abuja have said they hope the changes will make the NOC more transparent and accountable.