Passion for Service: Sylva’s Uncommon Steps

-By Fred Ojiegbe

The Ministry of Petroleum Resources, one of the ministries critical to Nigeria’s economic growth appears to be on a good trajectory with the appointment of Timipre Sylva as the Minister of State.

Sylva, who is on a familiar terrain, having served as Special Adviser to Edmund Daukoru, former Minister of State, Petroleum Resources, was one, if not the first, minister to resume duty immediately after he was sworn in by President Muhammadu Buhari in August, 2019.

The petroleum industry is critical to Nigeria but lack of realistic reforms, and poor policy implementation combined with frequent lack of
good working relationship between past ministers and the leadership of some vital organizations, parastatals, agencies under their supervision over the years has led to its steady decline.

The minister of state after his inauguration with the guidance of President Muhammadu Buhari who doubles as the minister of petroleum resources in response to some of the industry challenges, came up with a 9-Point Agenda for reform that will be pursued within the short and
long term.

Among them are the need to eradicate smuggling of Premium Motor Spirit (PMS) popularly called petrol across Nigerian borders, Complete gas flare commercialisation, LPG
(cooking gas) penetration and other gas utilisation projects and increase crude oil production to 3 million barrels per day (bpd).

Others include: reduce the cost of crude oil extraction by 5 per cent, achieve passage of the Petroleum Industry Bill (PIB) and passage of the Deep Offshore and Inland Basin PSC Act.

The last three challenges that the Buhari administration seeks to overcome in the oil industry is how to work toward increasing domestic refining capacity, create large number of well-paying jobs for youths and finally, how to take 100m Nigerians out of poverty in next 10 years, in line with the president’s next level economic agenda.

Sylva did not take time to understand the dynamics of the petroleum industry. Shortly after being sworn in as Minister of state, he said, “I know we have a very competent management in the Nigerian Petroleum Corporation, NNPC, Petroleum Technology Development Fund, PTDF, Department for Petroleum Resources, DPR and the Nigerian Content Development and Monitoring Board, NCDMB. I would like to take some briefing from all of you, after which I would make some proper response.” His footsteps so far as a Minister point to the fact that he must have been acquainted with the workings of the Ministry of Petroleum Resources.

In less than 100 days since he took over the reins of leadership at the ministry some remarkable successes have been recorded so far.

Despite being a politician of repute, Sylva is also a technocrat who understands the importance of planning in the process of effective management of resources. This skills was displayed few weeks after he took over when he summoned all the management of all the parastatals, departments, and agencies under him to develop and adopt the ministry’s 2019-2023 priority projects/deliverables. The minister who lauded the synergy and collaboration between the Ministry and its Agencies, affirmed his core focus on performance tracking of the implementation process of the priority projects.

The minister as the chairman of the NNPC Board has been instrumental to achievements which included: attainment of over 2 billion litres of PMS reserve, completion of Phase 1 of the Port Harcourt Refinery Rehabilitation exercise, Discovery of Oil in Kolmani River-II Well and the Re-opening of OML 25 flow station after two years of inactivity as a result of community issues between the host community/Belema Oil and Shell Petroleum Development Company. Over $6billion was lost due to the crisis. Today, Oil Production has resume at the closed Flow station.

Another milestone achieved in this regard was the resolution of the lingering crisis in the Benin Embayment of the OPL310 where Ministerial consent which stalled huge investment opportunities not less than $400million from Lekoil and Optimum Petroleum, has now been resolved amicably by Chief Sylva, giving way to financing and employment opportunities.

Within his short stewardship of the Petroleum Ministry, the NNPC has achieved the signing of a novation agreement with Nigerian Agip Oil Company (NAOC) to formalize the transfer of OMLs 60, 61 and 63 to NNPC’s upstream arm, the Nigerian Petroleum Development Company (NPDC); execution of a funding, technical services agreement and alternative financing deal worth USD 3.15billion for OML 13 and USD876million for OML 65.

Others are the signing of USD2.5 billion prepayment agreement with Nigerian Liquefied Natural Gas Limited (NLNG) for Upstream gas supply for trains 1-6 and attainment of an advanced stage of execution and Final Investment Decision of the NLNG Train 7 which is expected to be signed very soon; the industry has also witnessed the finalization of the 2018 audit of the NNPC Group as well improved engagement with key stakeholders, notably, the National Assembly.

The conducive relationship between various oil and gas professional associations, and labour unions in the industry has continued to be maintained by the minister as evidenced in the harmonious working relationship among the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), the National Union of Petroleum and Natural Gas Workers (NUPENG) and the entire industry which has brought stability, regained investors’ confidence and attracting foreign direct investment in the industry and the economy at large.

Also worthy of mention is the Deep Offshore and Inland Basin Production Sharing Contract (PSC) Amendment Bill passed by both Chambers of the National Assembly and assented to by President Muhammadu Buhari. The law will significantly increase Nigeria’s share of earnings for the country.

Sylva’s stewardship has given impetus to fast tracking of the Ajaokuta-Kaduna-Kano (AKK) pipeline project that will revolutionized the Supply and Distribution of the huge gas for both industrial, household (cooking gas) and feed stock for our power sector.

At the international stage Nigeria has continued to be relevant including playing very key roles in negotiation stages, leadership of committees and subcommittees and in crafting of the agreements at both local and international energy groups.

Chief Sylva who immediately after his inauguration took over leadership as the President of the African Petroleum Producers’ Organisation (APPO) and embarked on shuttle diplomacy to fellow African producers to explore joint strategies for collaboration to solidify Africa’s position in the Organization of Petroleum Exporting Countries (OPEC).

The Minister accompanied President Muhammadu Buhari to Russia-Africa Economic Forum held in Sochi, and the Future Investment Initiative summit in Riyadh, Saudi Arabia all in the month of October. During these two outings, important discussions were held, and MoU signed on the sidelines of the events that will revitalize the Nigerian petroleum industry.

Under the minister’s watch, Nigeria has aligned its oil production to the quota restriction set by the OPEC. Before now, the country was not obeying the cuts, according to figures published by Reuters and the International Energy Agency.

This development and the location of the statement is timely as Saudi Arabia had promised not to make any further cuts at OPEC’s December 2019 meeting unless it received assurances from Nigeria and Iraq that they would be 100 per cent compliant to the agreement reached in December 2018 and implemented since January 2019.

Remarkably, as Sylva set out to deepen transparency in the NNPC with the launching of “Operation White,” a team of 89 persons drawn from five key agencies, transparency and accountability in the distribution of petroleum products across the country is gradually being achieved.

Speaking at the inauguration, Sylva, said the team would help to authenticate the actual volume of products imported and consumed in the country and ensure that the nation attains energy security. The Minister stated that he was optimistic that the operation would stem the smuggling of petroleum products by some unscrupulous operators, stressing that the savings from the exercise would go a long way in supporting infrastructural development of the country. He recalled that few weeks after the closure of the nation’s land borders, daily Premium Motor Spirit (PMS) consumption dropped from 60million litres per day to 52million litres per day.

“I must say that I am very impressed with the caliber of the team members of ‘Operation White’ and am not surprised because every organization that I know is as strong as its leadership. The NNPC under the leadership of Mallam Mele Kyari epitomizes strong leadership. I am happy with the enthusiasm on the faces of the members and I am sure that we will succeed,” the Minister said. Members of the team were drawn from the Nigerian National Petroleum Corporation (NNPC), Department of Petroleum Resources (DPR), Petroleum Products Pricing Regulatory Agency (PPPRA), Petroleum Equalization Fund (PEF) as well as the Department of State Security (DSS).

Following the launch of “Operation White”, the Minister also unveiled the Automated Downstream Operations and Financial Monitoring Centre (DOFMC) to deepen transparency in the oil and gas sector. Speaking at the unveiling ceremony in Lagos, Sylva, said the activation of the DOFMC and the launch of “Operation White” were very clear signs of the President Muhammadu Buhari-led administration’s commitment to stamping out sleaze from the oil and gas sector and placing it on the path of growth.