…Observers Fear Re-Politicisation of Oil Giant
…NNPCL Gastech Pitch Overshadowed by Policy Shift
By Yinka Giwa
President Bola Tinubu’s reported approval of sweeping amendments to the Petroleum Industry Act (PIA) has triggered unease in Nigeria’s oil and gas sector, with analysts warning that the reforms could strip the Nigerian National Petroleum Company Limited (NNPCL) of its autonomy and re-politicize a corporation that was only recently repositioned for commercial independence.
The Attorney General of the Federation has already dispatched notifications to key agencies, confirming the President’s assent to the proposed Petroleum Industry Act (Amendment) Act 2025. The draft law, put forward by the Minister of Finance on the grounds that it will plug “escalating fiscal leakage and revenue loss confronting the Federation,” does far more than tighten fiscal controls. It hands new powers to the Ministry of Finance Incorporated (MOFI) and alters the governance structure that was central to the PIA’s promise of a modern, commercially viable national oil company.
Under the amendment, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) will replace NNPCL as the government’s concessionaire in Production Sharing, Profit Sharing, and Risk Service Contracts, while also becoming the signatory in model contracts tied to licenses and leases. The Ministry of Petroleum Incorporated (MOPI) will also be removed as co-owner of NNPCL, leaving MOFI as the sole custodian of the company’s shares on behalf of the Federation.
Industry observers say these shifts amount to a dismantling of governance safeguards embedded in the 2021 Act. They argue that by vesting sole ownership in MOFI—a finance agency with no operational mandate—the amendment effectively reduces NNPCL’s board to a passive executor of directives from the finance ministry. According to analysts, the principle of separating ownership from management, considered a cornerstone of corporate governance globally, is being replaced with direct political control.
Critics also warn that such a structure could expose NNPCL to the short-term priorities of politicians and fiscal managers, rather than to the operational needs of a company competing in volatile global markets. They suggest that strategic decisions may become distorted by fiscal considerations, undermining the agility required to respond to global energy dynamics.
Market watchers further note that the implications for investor confidence are significant. The original PIA was designed to reassure investors by insulating NNPCL from political interference and ensuring it operated under corporate principles. According to several analysts, the amendments now risk reversing that intent, raising concerns that Nigeria is sliding back into a more opaque, state-driven model of oil governance. Some warn that capital inflows and partnerships could dwindle if investors conclude that NNPCL is once again being politicized.
The concern comes at a delicate moment. Only last week, in Milan, NNPCL sought to woo global investors at the Gastech Exhibition and Conference. Group Chief Executive Officer Bashir Ojulari, speaking with NBC’s Hala Gorani, pitched Nigeria as Africa’s best bet for gas-driven industrialisation and cleaner energy adoption. He pointed to Nigeria’s vast gas reserves, over 200 undeveloped oil fields, and production capacity of 1.7 million barrels per day as proof of untapped potential, while highlighting projects such as the $2.8bn Ajaokuta-Kaduna-Kano pipeline and the NLNG Train 7 expansion as evidence of progress. Ojulari credited Tinubu’s reforms with improving the investment climate and presented the “restructured NNPC” as a commercially focused corporation committed to shareholder value.
Analysts say that message could now be undermined by the policy direction contained in the amendment. According to industry watchers, having told investors abroad that NNPCL was insulated from political interference, the government’s move to vest ownership and strategic direction in MOFI raises questions about whether the company will remain commercially driven. They warn that what was presented in Milan as a new era of professionalized governance may soon appear to investors as a return to Nigeria’s troubled past of politicized oil management.
Observers also highlight accountability risks. With MOFI taking charge of strategy, they note that responsibility for NNPCL’s performance could become blurred. A weakened board, they argue, cannot realistically exercise oversight or enforce accountability if its role is reduced to implementing ministry directives.
For a government under pressure to raise revenue, analysts acknowledge that the drive to centralize control of oil assets is not surprising. But they caution that weakening NNPCL’s independence could come at the expense of long-term sectoral health and investment. As investors weigh Ojulari’s confident pitch in Milan against the amendments now on the table in Abuja, industry observers say Nigeria’s credibility as a serious energy investment destination could be at stake.