BUSINESS
NNPC CEO Mele Kyari Pushes For IPO Amid Desperate Bid To Remain In Office
In a bid to secure his position, Mele Kyari, the Group Chief Executive Officer of NNPC Limited, is expediting plans for an Initial Public Offer (IPO) for the financially strained corporation, according to exclusive reports obtained by THEWILL.
This development follows Kyari’s premature announcement of a $3 billion loan from the African Export-Import Bank (Afreximbank), which is now facing setbacks. Over the weekend, several reliable sources within the oil industry challenged Kyari’s assertion that Nigeria’s crude oil production had reached 1.6 million barrels per day, dismissing the claim as unrealistic and baseless.
Industry insiders, including a contacted operator cited by THEWILL, estimate actual production to be around 1 million barrels per day.
“Why haven’t we seen an increase in revenue if Kyari’s figures are accurate? Our actual oil production hovers around one million barrels per day, primarily sourced from deepwater assets offshore,” stated one industry expert.
Another source in the investment banking community, who spoke to THEWILL anonymously, derisively laughed off the IPO proposition as a “calculated attempt to again embarrass the Tinubu Administration.”
“No market professional would support an NNPC public offering absent a solid due diligence exercise and a total clean up of the corporation’s account,” the source, an investment banker, said, asking not to be identified in this report.
THEWILL can report that the Afreximbank loan stalled because the lender was already over-exposed to the NNPC, which misrepresented the use of proceeds. Kyari had told Afreximbank that they needed the money to augment exploration and production but after the deal was inked, started claiming it was to shore up the value of the naira, a revelation that spooked the other lenders in the syndicate with Afrieximbank leading to a withdrawal of commitments.
THEWILL recalls that a similar development occurred with the financing of the AKK gas pipeline. The NNPC had entered into an agreement with Chinese lenders, with the Federal Government backing the deal with a sovereign guarantee. Unfortunately, the financing fell apart when the Kyari-led NNPC capriciously revoked the oil blocks of Chinese operator, Addax, and in retaliation, the Chinese lenders withdrew from the funding arrangement. The cash-strapped NNPC Limited has expended over $1.2bn of its own money to fund the construction of the pipeline with no visible source of gas and no single off-taker of the gas.
“Everything about the project is based on promises and hope. Meanwhile, NNPC finances are in tatters with debts and poor production from NNPC assets weighing down the corporation,” the source added.
The NNPC, under Kyari, has struggled to keep the country’s oil flowing due to multiple factors including poor management and lack of fresh investments in oil production. The four state-operated refineries remain shut down and have failed to resume operation, missing several deadlines Mr. Kyari and the NNPC had promised.
THEWILL gathered authoritatively that President Bola Tinubu, who is currently in India for the Nigeria-India Presidential Business Forum holding on the sidelines of the G20 meeting in New Delhi, is actively scouting for a replacement for Mr. Kyari, who was appointed by former President Muhammadu Buhari in 2019.
Garba Deen Shehu, the Spokesman of NNPC Limited, did not respond to our phone calls or messages seeking comments for this report.
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