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Nigeria’s president has replaced the board of the country’s state-owned oil company and put a former Shell executive in charge, as Africa’s largest crude producer tries to revive output and attract investment.
President Bola Tinubu said on Wednesday he had sacked the entire 11-person board of the Nigerian National Petroleum Company and replaced chief executive Mele Kyari with former Shell engineer Bashir Ojulari.
Ojulari previously served as managing director of Shell’s Nigeria deepwater exploration and production unit. He was most recently chief operating officer of Renaissance Africa Energy, the consortium that bought Shell’s Nigeria onshore division in a deal completed last month.
The new board will be led by chair Ahmadu Musa Kida, a former Total executive.
The firings and appointments were announced by a presidential spokesperson at 3.47am on Wednesday. Tinubu tasked the new board to immediately “conduct a strategic portfolio review of NNPC-operated and joint venture assets to ensure alignment with value maximisation objectives”.
Kyari was appointed to the role in 2019, making him the group’s longest-serving leader, and has been overseeing NNPC’s gradual progress towards a potential stock market listing. He oversaw the rejuvenation of two moribund government-owned refineries in a boost for local refining capacity.
But his tenure was blighted by falling oil production, as installations suffered from large-scale theft that frustrated the foreign companies that had been the backbone of Nigeria’s oil industry, the continent’s biggest producer.
Nigeria’s production fell below 1mn barrels a day in 2022 for the first time in more than three decades. Output has since picked up under Tinubu’s leadership, with Nigeria reaching its Opec quota of 1.5mn in January.
Foreign oil groups including Shell are exiting the country’s onshore industry, which has been plagued by scandal, giving domestic companies the opportunity to fill the void.
NNPC, which has historically been dogged by allegations of corruption and mismanagement, plays an outsized role in Nigeria’s oil and gas industry.
All oil exploration and production companies, whether foreign or domestic, are required by law to operate their assets in a joint venture with NNPC, which manages Nigeria’s interests in the operations.
Crude oil sales accounted for nearly 70 per cent of Nigeria’s exports last year and funds more than half of the government budget.
NNPC transitioned into a fully commercial entity in 2022 following the passage of a landmark petroleum act, but is still controlled by the president and the government is its sole shareholder.
The company said last week it was in the “final” stages of preparing for an initial public offering that has been in the works since 2021 but has so far failed to materialise. Analysts said appointing private sector executives was a clear indication that Tinubu was preparing for an eventual listing.
Tinubu surprised many observers in 2023 when he reappointed Kyari, a holdover from the previous administration under Muhammadu Buhari, to a second term in office.
