By Our Correspondent

The Senate on Thursday handed down a clean bill of health to the Minister of State for Petroleum Resources, Ibe Kachikwu, over his ongoing restructuring of the Nigerian National Petroleum Corporation, saying his action did not contravene any known law.

Ibe KACHUKWU

Kachikwu, appeared before the Senate Joint committees on Petroleum Resources ( Upstream, Downstream and Gas ) to explain the reason for the restructuring exercise.

But Kachikwu before going into a closed session that lasted about one hour with the senators, explained that his action was in the best interest of the country but regretted not holding necessary consultations with the National Assembly before announcing therestructuring.

He explained that the exercise was necessary in order to make the NNPC a real revenue generating organisation so that it would be able to offset the $5.2bn it is currently owing the major oil companies as well as reduce its current N30bn monthly losses as much as possible.

He also said the restructuring of the subsidiaries under the NNPC was aimed at making them more effective and efficient but that they would still be under the agency being controlled by a single board.

He said, “I must apologise that we didn’t take some of the senate leadership along the path of this restructuring but if you look at the draft of the Petroleum Industry Bill sent to us for our input, you will discover that the restructuring was within the suggestion we made.

“Having said that, I must take responsibility for not carrying out the necessary consultation as we should have done.”

A member of the committee, Senator Sola Adeyeye, said that the minister would have run foul of the law if he had stuck to the use of unbundling in the restructuring exercise because his action would have contravened Cap 23 (6) 1D of the Act that established the agency.

He argued that although the minister, in his capacity as the Group Managing Director of the NNPC was given free hand to operate, it would be illegal of him to create autonomous firms separate from the agency.

Briefing journalists after the closed session, Chairman, Senate Committee on Petroleum Resources (Upstream), Senator Donald Tayo Alasoadura, described the interactive session with the minster as highly rewarding and useful.

He said Kachikwu had been able to convince members of the three committees which are mandated to carry out oversight functions on the petroleum sector, that his action was legal and one that would boost the sector, generate more revenue and ensure stable supply of the product.

Alasoadura said, “We have a very useful discussion with the minister. He clarified the issue that he was not unbundling NNPC because it is an entity created by an Act of the National Assembly and nobody can touch it unless he comes back to the National Assembly for ammendments.