Providing Effective Leadership in Nigerian Oil and Gas Industry in a Turbulent Era




  • By Mailanti Baru 


I AM delighted to be part of this year’s Realnews Magazine Online Annual Lecture which holds today in Lagos. Your online medium may be only five years old, however, the impact, I reckon, it’s been making in the newspaper industry is phenomenal. I regard your reportage as responsible, balanced, fair, credible and well researched, underscoring, I suppose, your attraction to readers. I can only urge you to maintain your high standard as this will continue to open door for you in high places, locally and internationally.

The importance of the oil and gas industry to the nation’s economy is well known. Suffice to say that the industry generates 95 percent of the country’s foreign exchange and supports the industrial development and growth of the country, through gas supply to power, as well as supply of white products for commercial activities. With such weighty impacts on the national economy, it goes without saying that effective leadership is sine qua non for the oil and gas industry.

The tempestuous scenarios or occurrence, if you like, which call for effective leadership in the oil and gas industry in Nigeria are legion. Prominent among them, however, are the recurring security challenges in the Niger Delta which might be due to militancy activities, manifesting in turn in pipeline and other facilities breaches. They also include high volatility of crude oil prices occasioned by supply glut or global economic ebb as well as political intrigues that often lead to smear campaigns against the management of the national oil company by industry watchdogs or political opponents.

In each of these occurrences, the effectiveness of the leadership demands unique qualities and competences from the manager. In the case of security operational challenge, the effectiveness of the manager would be tested on the extent to which he or she can cut deals, employ the stick and carrot approach, dialogue with stakeholders as well enlist the support of the various arms of government like the National Assembly and the intelligence and security agencies to his or her rescue.

Similarly, in a turbulent era of low crude oil and prices, the effectiveness of the manager is tasked by his or her ability to rapidly review the company’s business models, with a view to reining in on the company’s costs. It also involves the manager taking proactive approach in engaging other crude oil producers to stem production as was the case that played out late and early this year when crude oil prices were lowest.

Vicarious hits from industry watchdogs or political opponents of the ruling party who consider the national oil company as an extension of government, depict aspects of a tempestuous era. An industry leadership effectiveness in this scenario would involve being proactively transparent in conducting the business of the national oil company. It would also require the dexterity of the political leadership moderating its over bearing interference in day-to-day running of a national company. Let me contextualise this overview with regard to the Nigerian National Petroleum Corporation, NNPC, experience.

The management of NNPC has been able to stay afloat the turbulence era in the industry by employing most, if not all the strategies enumerated above. To stem security challenges in the Niger Delta, for example, the NNPC management has been engaging industry stakeholders, including the various host communities. We have also stepped up the implementation of our Corporate Social Responsibility projects in the host communities, whilst employing members of the communities to guard the over 5,000 kilometres of pipelines and other facilities of the corporation across the country.

The era of price volatility is far from being enviable. The demand for forex, mainly expected from the corporation, not only attracts close marking on its activities, it also heightens constant pry into the corporation’s books, not to talk of excoriation from some of our more aggressive stakeholders.

The corporation has learnt to starve off attacks associated with price volatility through such strategies as proactive monthly release of NNPC operations and financial reports, which has gone a long way in securing for the corporation, high ratings with regards to adherence to transparency and accountability. Also, building on the corporation’s initiatives as a focused, accountable, competitive and a transparent organisation that is conducting its business with integrity, the NNPC leadership under my watch has effectively reined in on our cost elements such that despite the low price regime in the industry, we still deliver handsomely to the national covers.

I suppose that inform the near absence of the bitter criticism from some of our traditional critics. Low crude oil prices in the international market is a function of so many factors, which may include supply glut and low economic activities of some high energy consuming nations. Providing effective leadership to navigate the era, therefore, is well beyond an individual or nation.

On the contrary, it requires the ability of the various leadership personalities across nations to collaborate and dialogue to take collective action to improve on the fortune of the industry. I want to believe this was what played out in the last one year with the Organisation of Petroleum Exporting Countries, OPEC, as the rallying point. The role of Nigeria in bringing about the relative stability in the crude oil price in the last few months cannot therefore be over emphasised.

It will be deceptive to think that navigating the turbulence era in the oil and gas industry starts and ends with providing effective leadership alone. Responsible followership, I reckon, could also be part of the solution, if not the panacea. Exhibiting civilised behaviours, such as shunning engagement in willful destruction of industry assets, could lower frayed nerves and enable smooth operational activities.

Similarly, preference for dialogue, as against militancy, would augur well much more for the sector. These are attitudes and approaches that are within the followership. In the same vein, given the power of the media, responsible reportage of industry activities, as against sensationalism, is critical towards ensuring stability in a turbulent period in the oil and gas industry. It is my hope that all hands would be on deck to ensure an enduring stability in the oil and gas sector, as it is through this that government could generate the much-needed funds to run the system.

I thank the management of Realnews Magazine and Publications Limited for creating this platform aimed at finding solutions to challenges, which when overcome, would ensure an upliftment of the standard of living of our people. It is my prayer that your medium continues to wax stronger.


Being a speech presented by Dr. Maikanti Baru, Group Managing Director, Nigerian National Petroleum Corporation, NNPC

at the Fifth Anniversary Lecture of Realnews on Thursday, November 16, 2017 at Sheraton Hotel, Lagos.


– Nov 17, 2017 @ 20:56 GMT |



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