Over the past three years, NNPC Limited has achieved a remarkable Transformation.
Once a loss-making Government-controlled entity in 2018, it has evolved into a Thriving, Commercially driven Conglomerate, recording an Impressive N674.1 billion Profit in 2021.
This turnaround comes after Suffering Losses of N807 billion in 2018 and N1.7 billion in 2019.
Notably, 2020 marked a Significant Milestone for the Company as it Recorded its first profit in 44 years, amounting to N287 billion.
The Impressive Growth in Profit ratio, a staggering 183 percent increase between 2018 and 2021, is particularly noteworthy considering the Challenging backdrop of a drastic drop in International Crude Oil Prices during that period.
A major Contributing Factor to NNPC Limited’s resurgence was the decision by President Bola Tinubu to end Petrol Subsidies, which led to the deregulation of the Downstream Sector of the Oil and Gas Industry.
This move freed up Cash flows for the Company’s Trading activities, enabling it to Contribute N123 billion to the Federation Account revenue for June 2023.
The Contribution comprised N81 billion as a monthly Interim dividend and N42 billion from 40 PSC Profit Oil.
The Company also ensured Compliance with royalty and tax Payments.
To further enhance Operational efficiency and boost Profit margins, NNPC Limited Implemented measures to Reduce Operational Costs.
It achieved this by shutting down all unviable Strategic Business Units (SBUs), streamlining its Subsidiaries from 25 to 21.
Mergers and optimizations were carried out for better alignment, Cost-Effectiveness, and Economies of Scale.
For example, Oil Field Services, Integrated Data Services Limited (IDSL), and Frontier Exploration were merged to become NNPC Services Limited (EnSERV), focusing on Exploration, seismic data management, and general Oilfield Services.
NNPC Limited also streamlined its shipping Operations by merging three entities, NIDAS Shipping Services, NIKOMA Shipping Services, and Marine Logistics, to create NNPC Shipping Company.
The rehabilitation of the Nation’s three Refineries located in Port Harcourt, Warri, and Kaduna has been brought under a Single Supervision to optimize Resources and reduce overhead Costs.
Once completed, the Plan is to hand over the Rehabilitated assets to reputable Third Parties with Experience to Operate and maintain them.
With the enactment of the Petroleum Industry Act 2021 and the incorporation of NNPC Limited, the Company’s net book Value of assets transferred as of July 1, 2022, amounted to an impressive $58.8 billion, making it one of Africa’s most Valuable Companies.
The Company’s assets were further bolstered when it took over assets held on behalf of the Government by the National Petroleum Investment Management Services (NAPIMS) and started paying dividends to the Federation Account.
The transfer of the Pipeline and Storage Company (NPSC) to NNPC in 2022 further added to its assets.
NNPC Limited’s journey from loss-making to Profitable, its Strategic Restructuring, and its Increasing asset Value underscore its Significant Achievements in recent years.
