Nigeria to Take NNPC to Stock Market within Three Years, Kyari Says

The Nigerian National Petroleum Corporation, NNPC, has revealed a plan to list share in the stock market in the next three years, Mele Kyari, the Group Chief Executive Officer told Bloomberg News in a televised interview on Tuesday.

Kyari said the state oil corporation would consider an initial public offering within three years by 2024.

NNPC is to become a limited liability company after Nigerian President Muhammadu Buhari signed into law last month an oil industry overhaul that was 20 years in the making.

The federal government recently announced that the state oil company declared profit first time in 44 years amidst an under-recovery issue that continues to impact negatively the operation of the corporation.

“We want to get ready,” NNPC chief Mele Kyari said of a potential IPO. “The earliest consideration would be in three years’ time.”

He said NNPC would first need to recapitalise and get its books in order. Under Nigerian law, the government also has to specifically approve sales of company shares, which would be split between the ministries of finance and petroleum.

Buhari said last month that NNPC made its first-ever profit last year. Kyari said NNPC cut costs, improved efficiency and lowered borrowing rates. The company has yet to release full details of its results.

For most international and state oil companies, 2020 was a punishing year in which oil prices hit 20-year lows as the pandemic destroyed demand.

Kyari also told Bloomberg that he did not think OPEC+ needed to pause its incremental monthly production increases because the oil market was still facing supply shortages.

The group agreed earlier this month to proceed with a 400,000 barrel per day production increase for October as it phases out record cuts it brought in last year to tackle the pandemic-induced demand drop.

Nigeria to Take NNPC to Stock Market within Three Years, Kyari Says