Kachikwu Vs Baru: A look into the politics, intrigues

By Odunewu Segun

The run-in between the Minister of State for Petroleum Resources, Ibe Kachikwu, and Group Managing Director of the Nigerian National Petroleum Corporation, aggravated by a recent memo to President Muhammadu Buhari, would test the strength of the president’s desire to rid the corporation of sleaze. 

During the week, Dr. Ibe Kachikwu alleged that the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Maikanti Baru has overreached his authority by making numerous changes in the internal structure of the NNPC.

In the memo, which was dated August 30, the minister accused the NNPC boss of labelling him as “corrupt”, “anti-north,” and also being “in collusion with militants”,  and indicated that this was done to convince the president on the need to sideline him in the decision-making process in the state-run oil firm.

He also alleged that Baru awarded about $24 billion major contracts without his input or review by the NNPC board, adding that the contract procurements were done without recourse to the board.

NNPC discharges its function by a board in which the Minister of petroleum is the Chairman of that board. The members of the board are also to include the Director General of the Federal Ministry of Finance, the GMD and 3 people appointed by the National Council of Ministers with requisite knowledge or experience in the oil and gas industry.

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As Nigeria has no substantive minister of petroleum, a position supposedly held by the president, it is expected that the state minister for petroleum Kachikwu Ibe, heads the board either in his position as the state minister or by implied appointment by the president, who by virtue of the NNPC ACT has the power to appoint an alternate chairman to head the board.

By simple rules of corporate governance, while the GMD would be in charge of the day to day running of the NNPC, it is expected that major policy decisions will be approved by the board. The Minister of State has alleged serious overreaching on the part of the GMD without recourse to him and it should be expected that with the nature of the kind of company that NNPC is, the head of the board is expected to have prior information before decisions affecting the structure of the NNPC. Whether or not these decisions require the consent of the chairman would be a separate matter entirely.

However, it seems that there is more to the whole issue and there might be a political undertone. The memo sent to the President also allege that the minister has tried to make appointments with the president and that has been futile on several occasions.

This is quite strange owing to the fact that Mr. Abba Kyari who is the president’s chief of staff is also a member of the Board of Directors of NNPC and his position avails him the opportunity to carry the minister’s grievances directly to the president or better still facilitated an appointment between the president and the minister.

It would be too early to determine the outcome of the memo, but it is very clear that there is no synergy in the board charged with the responsibility of bringing out the best from the country’s oil resources.