The comatose state of our refineries would ordinarily suggest that we could concession or privatise the refineries possibly to achieve better performance of the upstream sector of the oil industry; but it is not as straightforward as that. This strategy may have been working in other areas of the economy but it should not be applied to this main stay revenue source. Indeed, it will be contradictory and counter-productive to privatise the refineries at a time when the Nigerian National Petroleum Corporation, NNPC, is tinkering with the good idea (though belated) of transforming itself into a world-class oil company.
The NNPC is one of our strategic national identity and heritage, being our national oil company; giving it to private individuals or even conglomerates which may include foreigners is like losing our national identity and committing economic harakiri in the process.
Developed economies thrive on institutions and infrastructure which the NNPC and the refineries veritably are. The successful implementation and achievement of the much-talked about Vision 20:2020 partly depend on the successful transformation of the NNPC into an international oil company, even though it has hitherto, remained an inactive investor in the nation’s upstream sector. Privatising the NNPC will rob the nation of owning a national oil company and this will be too bad. The NNPC must be made to operate across the broad spectrum of the supply chain because you cannot be a successful national oil company, NOC, and be seen to be privatising, it will be one of the greatest contradictions of this era. So, the NOC must own its refineries.
The NNPC must process its production,
it must operate upstream, it must market its production, indeed, it must dominate its business environment. We ought to have learnt something from past attempts at transformation that failed which threw up the issue of strategic autonomy, we cannot afford to fail again.
A national oil company must face all the business of oil and gas, we must concurrently align ourselves with national economic growth aspirations. Although the NNPC’s contribution to the nation’s gross domestic product, GDP, has been dismal at 29 per cent, it could yet do better and the strategic autonomy a transformed NNPC should enjoy would come with operational independence, it must be self-financing and be truly national in outlook.
Privatising the refineries will be the greatest economic blunder in our national economic initiatives; therefore, transform it, re-invigorate and make it more viable.
It is the chicken that lays the golden egg.
Asaaju is a Lagos-based legal practitioner
