MKK: The Disruptor At the Helm Of NNPCL
He came to office as the 19th Group Managing Director of Nigerian National Petroleum Corporation Limited (NNPCL) with the mindset to challenge the status quo, embrace innovation, have a fearless attitude towards taking risks and have a strong vision for change.
The challenges he met on the ground could provoke a meltdown for the fickle-minded but five years down the line, he has significantly altered the oil behemoth, provoking, in the process, an enduring transformative agenda that may well unleash the country’s long-awaited energy revolution.
At his inception in office, the choices Mele Kyari faced could not be starker: either to continue on the unenviable trajectory to perdition or initiate a raft of reforms imbued with revolutionary aesthetics that would unleash systemic changes consequential enough to impact the fortunes of the company.
Even before he unpacked his vision, stakeholders within the industry were already setting the agenda for him. The global transparency group, Extractive Industries Transparency (EITI), urged Kyari to use his appointment to promote greater transparency and accountability in NNPCL management of Nigerian oil and gas revenues.
Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) pointed to the challenges the management under the leadership of Kyari should urgently address. The PENGASSAN wish list included challenges associated with pipeline vandalism, crude oil theft, inadequate infrastructure, pricing uncertainties, obsolete refineries, contentious fuel subsidy issues and the Petroleum Industry Bill (PIB).
Great expectations fueled by Kyari’s appointment at the helm of NNPC were borne of a solid reputation built over the years. An insider with a wealth of experience traversing many divisions of the company’s operations, including occupying the position of Group General Manager, Crude Oil Marketing Division and Nigeria’s national representative to the Organization of the Petroleum Exporting Countries (OPEC), his outfield pedigree in petroleum economics and crude oil and gas trading would prove pivotal to delivering a stellar performance long awaited by Nigerians.
As an internal change agent, Kyari saw himself as a catalyst for the change management process, which will reposition NNPCL, the much-maligned symbol of Nigeria’s vast natural resource wealth hobbled by systemic mismanagement, corruption and inefficiency.
His Roadmap to Global Excellence, which encapsulated the strategic focus of his management, is borne out of his conviction that, as the main enabler of the Nigerian economy, the NNPCL must entrench processes to ensure steady production growth and profitability across the oil and gas value chain.
In practical terms, his new management philosophy anchored on Transparency, Accountability and Performance (TAPE) envisions the transparency component of the agenda to maintain and enhance a positive image and to share the values of integrity and transparency with all stakeholders, whereas the accountability part of the vision would ensure compliance with business ethics, policies, and regulations and accountability to all stakeholders.
Kyari envisioned the Performance Excellence leg of the agenda to entrench a high level of efficiency hinged on the efficient implementation of business processes, which would also place an appropriate reward system for exceptional performance amongst the workforce.
Fully appreciative of the critical role of technology in driving and unfurling the enduring vision he had in mind, he activated a Business Continuity Plan (BCP), based on digital automation of the company’s processes. Under his guidance, the NNPCL-IT Division automated the Key Performance Indicator Dashboard across the entire IT enterprise and architecture. This masterstroke led to the improvement of reporting efficiency and real-time performance tracking. The Microsoft Enterprise Additional Licenses for NNPCL Digital Transformation initiatives he activated led to an estimated cost-saving of over $1m for the company.
Reforms, profit and transparency have been the hallmarks of Kyari’s leadership. The challenge has, however, been how to unleash consequential change without getting fired. For sure, there has been pushback by entrenched forces within the system but the fact that Kyari has unleashed what unarguably is the most transformative change in the company’s history stands remarkable.
His averment that “Going forward, we will seek to continuously entrench transparency, accountability and performance excellence across all NNPCL operations and put all necessary structures in place to ensure compliance with these principles” was a statement of unwavering commitment and not a fluke. He believes that prudence, accountability and cost minimization were central to his efforts to maximize profit in a competitive market.
As evident, within his first year in the saddle, NNPCL was able to reduce losses from N803bn in 2018 to N1.7bn in 2019; in 2020, the company declared a net profit of N287bn, an epic achievement since its inception in 1977.
This was no mean feat because the company was playing in a very challenging operating environment, which tested the resilience of businesses and institutions. While companies all over the globe struggled with recessionary forces and a weak economic outlook in the aftermath of the COVID-19 pandemic, in 2021, the company posted a profit of N674bn, an increase of N387bn or 134.8 per cent when compared to the N287bn recorded in 2020.
As a result of the efficient management of the affairs of the company under the leadership of Mele Kyari, the audited financial statement revealed an increase of 2.6 per cent of total assets from N15.86tn in 2020 to N16.27tn in 2021; total liabilities also decreased by 8.3 per cent from N14.68tn to N13.46tn in 2021.
Given Kyari’s prudent and shrewd management trajectory, the shareholder fund position also followed an upward swing as it rose to N2.81tn in 2021 as against N1.15tn in 2020. This stellar performance represented a 144 per cent increase in shareholders’ funds as of December 31, 2021. In 2022, the company’s profit grew to N2.548tn, followed by another upward swing of N3.297tn in 2023.
Interestingly, as of August 2024, NNPCL’s total assets were N246.8tn, which is more than Nigeria’s nominal GDP. Building a world-class company requires not only a profound vision; it is one driven by an unwavering commitment and unyielding passion unencumbered by traditional inhibitions and fright to smash the status quo.
As a change agent, Kyari, the unrepentant iconoclast, like all transformational leaders, is consumed by unremitting passion and enthusiasm, vision and purpose, intellectual curiosity and inspirational motivation. As the Group corporate leader, these intrinsic sterling qualities have driven him to the climax of human exertions where failure is unthinkable.
His punishing work ethic, undiluted patriotism, and a strong desire to launch the oil behemoth on the path of irreversible transformation and progress have driven him to smash records. The enactment of the Petroleum Industry Act, a landmark piece of legislation that took over twenty years to come, had the imprimatur of Mele Kyari.
He successfully rallied diverse stakeholders to build the needed consensus, which paved the way for the passage of the bill into law. The law led to the establishment of new regulatory bodies such as the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Down Regulatory Authority.
These days, NNPCL continues to demonstrate readiness and determination to achieve carbon neutrality through the use of the country’s abundant natural gas resources as low-carbon alternatives that will help improve access to energy, all thanks to the commitment and vision of Kyari. His LPG Expansion Plan is encouraging the use of gas in families, power generation, autogas and industrial applications.
Kyari has successfully guided the diversification of NNPCL beyond its traditional oil assets. He has entrenched a governance structure that will ultimately transform NNPCL into a world-class company. In the coming years, with the support of the current administration and the endorsement of Nigerians, this lofty vision will be achieved.
– Victor Odiogor, a public affairs analyst, wrote from Surulere, Lagos.
Disclaimer: This article is entirely the opinion of the writer and does not represent the views of The Whistler.
MKK: The Disruptor At the Helm Of NNPCL is first published on The Whistler Newspaper
