Breaking News
Translate

Nigeria remains a very attractive destination for foreign investment , Barkindo

DR. Mohammed Sanusi Barkindo, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC) had early last month unveiled a transformation programme geared towards moving the corporation and its small business units from a negative cash flow position to a world class enterprise and take a place of pride among other national oil companies.

barkindo

To achieve this he and members of top management of the corporation met with some international and local Nigerian banker in London under the aegis of a two day workshop to explore available funding options. He spoke with Hector Igbikiowubo, Editor, Sweet crude on the sidelines of the event on the impressions of his management, the PIB, pipelines monitoring among other issues.
Excerpts:

You have had two days of meetings with both foreign and local Nigerian banks exploring funding options for a corporation in transition, how would you describe your interaction and what is your management coming away with?

Very successful, it’s been two full days of very intensive interactive discussions with the world’s leading investment banks together with two leading Nigerian banks including First bank and UBA. It’s beyond my expectations, you can see the turn out, not only from the banks but there are experts that came and the interest they have shown and the support and commitment they have exhibited in the transformation programme. I think the good news for us here as Nigerians is that Nigeria remains a very attractive destination for foreign investment. Nigeria is currently being reclassified as the next 11 of the emerging economies and this is a good story that we should be proud of and we should continue to work very hard and proceed with the reform programme at home so that we can solidify our position in this new club of the 11 emerging countries.

As the NNPC tries to catch up with its peers as a viable national oil company, what other challenges do you envisage?
Of course there are enormous challenges because the NNPC has been operating since its inception in 1977 as a government corporation, as an agency funded and literarily operated by government and what we have decided to do now is to abandon that model, if it were to be referred, to a model of best practise in line with the best international practices, transforming the corporation from its current state to a successful national oil company that is fully commercialised, fully capitalised, operating with the highest standards of HSE, that can compete with any national oil company anywhere in the world.

JP Morgan had yesterday identified possible funding options going forward and they also suggested that perhaps NNPC can explore self financing as a start. What are your thoughts on that?

There are a variety of financing options as well as instruments and products in the short, medium and long term that we had explored with all the banks and it’s difficult at the moment to just pick one financing option or instrument. At the end of the day we have to design hybrid products as well as instruments that will suit not only our environment but the new model that we have adopted as well as the part of growth and development that the transformation will put us on.

A few minutes ago, First Bank during their presentation also identified funding gaps of between $1.2 billion and $4.8 billion in the short run and that is over the next 3 years. How does your management plan to tackle this sir?

Yes, all the banks that we have talked to from yesterday to today have literarily committed themselves to participating in meeting this funding gap. One of the objectives of this two day meeting is not only to assess the funding gap which we have all agreed upon on the numbers but also how do we fund this gap. And one of the things we have achieved is agreeing with them on the most cost effective instrument that we could deploy. Therefore we are going to proceed with a follow-up with selected banks out of this crowd that we have met in Abuja to further drill on these options and models as well as the numbers. But I am confident that we are on the right part. We have been accepted as the right candidate to transform and they have committed their support to our transformation including the publishing of this funding gap.

Standard Bank also identified deep pocket financiers in the USA. Are you considering exploring options out there as well?
I think all options at the moment are on the table. At this preliminary stage, what we have achieved in the last two days is to explore all these options and as I said these options are rated as short, medium and long term. There are a variety of them. There are new, sophisticated and innovative products that are being churned out in the market and this meeting enabled us to analyse these products. Now it will be up to management together with the other stakeholders to eventually decide on the hybrid of products and options that we are going to deploy not only in the short term but in the medium to long term.

Let’s take a look at the PIB (Petroleum Industry Bill). The expectation was that at least by March, 2010, we would have heard the legislators give us some positive pronouncements. Do you have any information that can inspire confidence that this Bill is well on course and would be passed into law anytime soon?
We are cautiously optimistic that with the passage of the appropriation bill by the national assembly, focus now will shift to the PIB and the level of the legislative process of the bill is already advanced. The legislators have done a great deal of work and I think what remains now is for them to finalise that work and pass the bill.

Last week you identified loses amounting to over N170 billion incurred in the last 10 years as a result of petroleum products pipeline vandalism. Are there any plans in the pipeline for enhanced monitoring?

If you recall in the last two weeks we have engaged stakeholders like the security agencies  military, police, some of the state governments as well as the communities and this is ongoing in order to solicit their support in ensuring the safety of these facilities, it is absolutely essential for us to be able to secure our pipelines, be they crude pipelines, petroleum pipelines, gas pipelines in order to continue to provide the services that are expected of NNPC.

I remember the Chief of defence staff talked about using an electronic system. Is this under consideration?
Next week, a delegation led by my colleague, the Group executive Director, Engineering and Technical, together with representatives of the military, representatives of the police and others will be participating in a programme here in the UK to explore the multiple technologies that are now being introduced to the market for monitoring of pipelines. There are so many of these technologies, so, it is up to you to assess them and to decide which one is suitable for your environment and your purpose. We have taken the suggestion of the CDS (Chief

of Defence Staff) very seriously, so that we complement the physical manning of the pipelines by the military, the police and the JTF. We need to also acquire the appropriate technologies to assist us in this regard.


Disclaimer

Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.