Unease over reports that the NNPCL boss has given Northern oil tycoons control of Nigeria’s pipelines

According to reports, four oil businesses, including two downstream retailers, received lucrative rehabilitation contracts for the country’s pipelines from Mele Kyari, the managing director of the Nigerian National Petroleum Corporation Limited (NNPCL).

The action is considered as equivalent to giving the shops control over the pipelines at the danger of exploiting other retail establishments and Nigerians as a whole, according to an article in People Gazette on Friday.

According to the newspaper, Oilserv Limited, A.A. RANO Nigeria Limited, Macready Oil & Gas Service Company Limited, and MRS Oil Nigeria Plc were the four businesses selected to receive the lucrative contracts for maintaining the nation’s pipelines, which expedite the flow of crude oil to refineries and transport its byproducts back to the nation.

A.A.Rano Nigeria Limited and MRS Oil Nigeria Plc, two retail companies owned by two northerners, Auwalu Rano and Sayyu Dantata, respectively, reportedly received the highly sought-after contracts, but there are persistent rumours that a cabal continues to control the country’s petroleum sector, according to the online newspaper.

According to reports, the NNPC GMD routinely gave select oil companies preferential treatment when it came to contract negotiations. To meet the country’s demand for motor and jet fuel, one such event occurred in 2021 in the crude-for-fuel exchange contracts.

Thoughts that a conspiracy is still very much active in the Nigerian oil sector are being confirmed by the most recent pipeline contracts handed to the two firms.

The contracts were awarded on a LOT basis, with MRS Oil winning the most lucrative LOT 4 contract, which is responsible for managing depots in the South-West, including the Mosimi-Ore Products Pipeline (151.3km), the Ibadan-Ilorin Products Pipeline (168.9km), the Atlas Cove-Mosimi/Satellite Products Pipeline (72.8km), the Mosimi depot, and the Mosimi-Ibadan Products Pipeline (79.1km).

LOT 2 was awarded by A.A. Rano, giving the retailer control over the South-South region. LOT 2 includes the Escravos-Warri Crude Oil Pipeline (60 km), Warri-Benin Products Pipeline (90 km), Benin-Ore Products Pipeline (110 km), Warri Depot, Benin Depot, and Ore Depot.

The contract award was questioned by industry insiders who claimed that any retail company shouldn’t have this much power over the country and that it would eventually backfire.

Kelvin Atafiri, CEO of Cavazanni Human Capital Limited, verified Nigerians’ suspicions that MRS Oil now has major sway in the country’s South-West region and has the power to decide not to provide opposing stores with fuel and set a price at which consumers will pay exorbitant prices to buy.

“LOT 4 is a market that is quite well developed, and NNPC has already incurred the capital expense for infrastructure before transferring to the favoured winner. It offers the winner a competitive advantage over the losers, according to Mr. Atafiri, who spoke to Business Day.

The secrecy with which the contracts were distributed further supported the idea that the cabal was still running its regular business, albeit covertly.

In 2022, NNPC officially defended its choice to give N48 billion to ex-militant Government Ekpemupolo, often known as Tompolo, to guard the country’s pipeline against vandals over a 24-month period, but it has not spoken out in regards to the awarding of pipeline contracts to A.A. Rano and MRS Oil.

If President Bola Tinubu, who serves as the country’s petroleum minister, was aware of the covert contracts that A.A. Rano and MRS Oil were pursuing, the State House did not react to a request for comment right away.

The head of NNPC, Mr. Kyari, did not respond to inquiries about this issue.