How NNPC recorded first profit after tax in 40 years

In the last 40 years of its operations, the Nigerian National Petroleum Corporation (NNPC) has consistently recorded losses in its statement of account.

In the year 2020, however, the corporation recorded its first profit after tax, a whooping N287 billion. This feat was recorded in the COVID-19 lockdown year!

Mele Kyari, group managing director of NNPC, during an emergency media briefing on Thursday, unequivocally declared that the days of declaring losses by the nation’s oil company were over, saying it has been entrenched on a progressive path to yield desired dividends to Nigerians.

Read also: NNPC attributes N287bn profit to cost control, automating process

Kyari attributed the 2020 profit after tax to deliberate efforts to cut costs and its determined refrain from delving into any toxic ventures. Of course, the top management also engaged in low-interest borrowing.

His words; “The success came from doing things differently. When the incumbent administration came in 2015, a new operational template was installed which centres on cutting costs, increased transparency, etc. Buhari’s template led to what we have now. When I came, I continued from where my predecessor stopped.

“We were careful about what to invest in. This led to loss reduction in 2019 and a profit in 2020. It’s indeed a collective activity.

“We stopped buying what we didn’t need. We engaged our contractors to pull down costs by 30%. We also got logistics cost reduction, low borrowing cost and all that.

“The N287 billion is profit after tax. Either we add to it our capitalisation or decide what to do as the board decides”.

Kyari disclosed plans to make the NNPC a public liability company in future via an initial public offer so that Nigerians could own stakes in it.

He expressed gratitude to President Muhammadu Buhari, who doubles as the Minister of Petroleum, for giving the NNPC a free hand to run the corporation without losing sight of how things were done.

He also applauded Timipreye Sylva, minister of state for Petroleum Resources,  for his leadership direction while appreciating the board members, management and staff of the corporation for their hard work and unwavering support.

Sylva who attended the media conference, albeit, virtually also remarked on the strength of unity and cohesion which, he said, contributed to the achievement of the GMD and his team.

The event also had in attendance all the executive directors, top management and senior officers of the corporation.