NNPC CEO and CFO Paid Gratuities While Still in Active Service

The Nigerian National Petroleum Company Limited (NNPCL) has confirmed that Chief Executive Officer, Mele Kyari and the Chief Financial Officer, Umar Ajiya, were paid gratuities while still in active service. The gratuity is a sum of money paid to an employee at the end of a period of employment.

Reports had surfaced that Kyari and Ajiya paid themselves billions of naira as gratuities, with some other top officials of the NNPC reportedly also paid. It was suggested that this move was made over fear of being retired compulsorily by the incoming government of Bola Ahmed Tinubu.

Garba Deen Muhammad, Chief Corporate Communications Officer of NNPCL confirmed the payment of gratuities to the duo and others but said they were paid for their service to “NNPC and not NNPCL.”

The NNPC completed its incorporation in September 2021 weeks after the Petroleum Industry Act (PIA) was signed into law by President Buhari. The NNPC Limited was then floated with an initial capital of N200 billion, making history as the company with the highest share capital in the country.

The new entity was expected to become a commercially oriented and profit-driven national petroleum company independent of the government, although government bodies remain its shareholders and would be audited annually.

The Petroleum Industry Act 2021 makes clear provisions relating to governance, administration, and the appointment of a CEO, CFO, and Board of Directors by the President. The PIA 2021 is deliberate about the long-term sustainability of the 20 years long petroleum industry reform that climaxed in the creation of NNPC Limited as a commercially driven National Energy Company, with a focus on sustainable value creation.

Based on the provisions of the act, the new tenured roles assumed by Kyari and Ajiya with NNPC Limited cannot be regarded as a continuation of their previous positions in the defunct Corporation.