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Africa’s richest man and President of the Dangote Group, Alhaji Aliko Dangote, yesterday said the Nigerian National Petroleum Company Limited (NNPC) has what it takes to become the African version of Saudi Arabia’s Aramco in the near future.

Dangote who spoke at the ongoing 2023 Upstream Investment Management Services Ltd (NUIMS) Annual Value Assurance Review (AVAR) Workshop, stressed that the oil giant could generate billions of dollars in revenue if the right decisions were made. The year’s theme was: ‘Consolidating for Growth in PIA Era.’

The event was attended by the Group Chief Executive Officer of the NNPC Mele Kyari; the Executive Vice President (Upstream), NNPC  Adokiye Tombomieye; the Chief Upstream Investment Officer, NUIMS, Bala Wunti; the Chairman, Heirs Holding, Tony Elumelu and other top investors in the Nigerian economy.

Dangote recalled that the PIA has now brought the transformation of NNPC from a government establishment to a commercial entity with no recourse to government funding.

He said the NUIMS has a critical role to play in unlocking funding to take advantage of the huge opportunities in the sector as well as to actively manage the investments to repay its loans, generate reasonable returns, and fund investment in new opportunities.

 “I truly believe that NNPC should be our African Aramco. You have what it takes to take you up there and I am very happy. There is nothing that is impossible. You can make it possible and don’t let anything scare you.


“It is just the same thing with us.  If I tell you about our own story, you will be shocked as to how. It wasn’t only the refinery that we started about six years ago. We had 32 projects that we all rolled out at the same time.

“But then, on the way we had lots of hitches here and there where the devaluation of the currency, Covid, and challenges of infrastructure set in. If you want to do a real project in Nigeria, you have to look at the infrastructure that we have, because the infrastructure we have is not meant for mega projects.


“We need to look at our infrastructure and see how we can take ourselves to the next level and it has to be driven by NNPC because they are the largest conglomerate and whatever happens to NNPC and their assets, it actually happens to us either directly or indirectly.

“Without you doing well, the country cannot do well. As the investment arm of NNPC, NUIMS plays a critical role in managing the federal government’s interest in the oil and gas industry – you are a partner in the Joint Venture (JV) assets and the concessionaire in the Production Sharing Contract (PSC) arrangements.


“ As important as its oversight function is, my expectation in this post-PIA era is that NUIMS should pivot from being overly focused on its role as a ‘watchdog’ to acquiring the mind-set of an aggressive investment manager,” the business magnate stated.

The billionaire added that the NNPC needs to roll out massive investments in terms of oil and gas to meet demand, adding that there are many off-takers waiting to invest.

 “Let me quickly illustrate with a personal experience. My businesses in Nigeria require 635 million scf of gas per day with further additional demand as we expand capacity.

“No businessman will leave such an opportunity on the table. Unfortunately, I hardly get 300 million scf per day and there is no clarity as to when the required gas will become available,” he lamented.


According to the chairman of Dangote Group, a good investment manager actively seeks out investment opportunities, assesses them and takes an investment decision.

He advised the NNPC to focus on delivering strong returns; growing the investment portfolio and managing portfolio risks, pointing out that the NNPC must first look into the cost component of its production.


Stressing that Nigeria has one of the highest breakeven prices globally for extracting oil and gas which results in a long payback period, the business mogul, advised the national oil company to embark on cutting costs.

“Let’s begin with delivering strong returns, which of course is a function of price and cost. While price in your industry is determined by the market and so clearly outside your control, the same cannot be said about cost. More aggressive cost targets need to be adopted and NUIMS staff rewarded with juicy bonuses if they meet these targets.

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“You need to benchmark costs with producers in similar basins and aim to be the lowest amongst your peers. Some existing government policies, as laudable as they may be, also need to be re-evaluated. For instance, we need to strike a delicate balance between encouraging local participation in the oil & gas sector and compromising efficiency and cost,” he advised.

Dangote suggested to the NNPC that the next course of action as a manager should be to grow its investment portfolio explaining that it would reduce the influence of International Oil Companies (IOCs).


Also speaking, Elumelu, who is the Chairman of Heirs Holdings, lauded the NNPC for the effort it made to curb crude oil theft, highlighting that due to the efforts of the NNPC , the company has witnessed 96 per cent recovery rate.

“When I listened to the Group CEO speak today, talking about us moving to 2.5 million barrels we challenge him to do more. I believe that it is achievable. From losing 97 per cent of our 50,000 barrels production, interestingly and it will be bad of me to have this platform and not share this here.


“That day, I got a call from the GCEO and I thought he was going to kill me for speaking up, to my greatest surprise, he said to me Tony we are sorry about what is happening, we are doing something about it, it will be corrected.

“They worked as a team and the board of the NNPC, the federal government, the security agencies, and last month our recovery factor was 96 per cent. So GCEO NNPC, you have delivered.

“I speak from experience, a beneficiary and one who cried out before and today standing up today to say we have improved our production and that is what we need to encourage more investments in the industry.”

He added: “Today, we lifted 501,000 barrels of oil bringing our total lifting this year alone to 2.6m barrels of oil. I am a great beneficiary of the new NNPC.”


In his remarks at the event, Kyari said the challenges facing the oil and gas industry globally have made it compelling for the NNPC to come with more ingenious ways of doing things.

He admitted that there have been challenges with security and underinvestment in recent times, adding that with the passage of the Petroleum Industry Act (PIA) the NNPC had been better positioned to create value for Nigerians.

He said: “The crux of the industry is to make sure the upstream industry works. If the upstream works, there would be cash in the country. We are in cash crunch in the country today, we are in forex crunch today because the upstream has not gotten to a level where we can have surplus to support the economy.

“And the reason is because we have challenges of security, decarbonisation issues, energy transition, and reluctance of finance institutions to lend.

“The practicality of all these is that there is difficulty in having access to capital today and this is very obvious, the whole world is lamenting today and there is absolute supply gap in gas in the market in the short term and for a while to come and everyone is taking a step backwards on what could be done to arrest the situation.

“As a company, NNPC is leading this process, we are required to ensure that production cost is optimum, we have interest in nearly every business in the upstream sector and even in the midstream and our performance determines what happens in the industry. We are in a position to go back to normalcy.

“Production target that we have kept over the years of 2 million barrels are realisable but have remained on the powerpoint and this is the time to take them off the powerpoint and resolve the insecurity, investment and financing issues.”

As a national oil company, Kyari said the NNPC must cooperate with its partners to solve the energy challenges facing the country.

He stressed that it was only through collaborative efforts with its stakeholders and partners that the NNPC can guarantee energy for the nation’s industrialisation.

Kyari added, “We can solve the problem of energy poverty in the country, we can also support the rest of the world particularly West African countries to resolve the energy crisis that we are facing today.

“We can also help to resolve the issue of food security and by doing this, we will make more money for the country and businesses make more money.

“We will invest in power and we are doing it and we believe that at the end of the day, we will create sufficient power for the country so that industries will spring up everywhere and create that prosperity that we desire.

“We have the best of workforce that we have anywhere in the world and we have seen many things that they have done. This means that our short term is real, our short term is achievable and as a company, we will satisfy the requirements of our partners and shareholders.

“Our performance will speak for our us and our country and this is what we are focused on doing, we will work with you, we will work with the industry, we will work with our partners, we will work with our shareholders and ultimately, we will deliver value in a short time of three years and this is sufficient to bring all the value on the table.

“We are getting all the support from the security agencies to make sure this works and we are getting maximum cooperation and we will overcome the security challenges and this company will deliver value for all of us.”

In his speech , Tombomieye said the enactment of the PIA came with so many expectations for NNPC, which has been transformed into a fully commercial entity.

He said the oil and gas reserve base in Nigeria was enormous as available data indicates that the current crude oil and condensates production of 1.210 million barrels per day as of April had fallen short of the desired aspirations of 1.395 mmbopd for NUIMS.

According to him, additional effort would be required to meet the objectives of growing reserves, oil and gas production, and monetising the subsurface resources.

He said: “There is no gainsaying that several challenges have bedevilled our operations over time, ageing facilities, obsolete technologies, evacuation challenges, high production cost, inadequate workforce, inadequate funding.

“NUIMS has consistently demonstrated the zeal to overcome some of these challenges, as depicted in the recent strides for the emplacement of the industry-wide Security architecture, which has assisted in restoring production in some corridors.

“We are no longer in the powerpoint era, and you must channel your energy towards reducing costs and growing production and revenue. Nigerians are watching us, and we must remain accountable to them.

“The Board and Management of NNPC Limited have tasked us with specific deliverables. We have executed the KPIs with timelines on when to deliver and can no longer afford to return with excuses to our principals for non-performance.

“Let us consider ourselves partners in progress, and every contribution is for the collective good of the company. Knowing fully that the strength of a chain is at its weakest link, we must strive to support each other on this journey of making the upstream directorate the shining light of the company as it has always been. “

In his address of welcome, Wunti said NUIMS currently has over $60 billion assets under its management which has positioned it effectively to contribute significantly to the development of the Nigerian economy.

 We have assets under management that are $60 billion and out of these assets, we are expected to produce so much hydrocarbon in a very difficult environment and that hydrocarbon we will produce tends to achieve the things NNPC has set as responsibility.

“There’s no better engine of growth in any economy than its SMEs. Our SMEs today are being faced with several problems. But one problem outside physical issue is the inadequacy of energy.

“And this energy security is our responsibility and we are having various challenges and if we have $60 billion of assets under our management, and if those assets represent 75 per cent of the total assets of the country, it means 75 per cent of our inability to deliver that energy is a result of our action or inaction,” he stated.

Source: THIS DAY

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