New Directive 9 is Likely to Backfire

Norman Cousins' profound words, "Wisdom in people consists of the anticipation of consequences," resonate deeply, particularly in the context of the Nigerian National Petroleum Company Limited, which was established to drive economic growth and development but has instead become a drain on the nation's resources.

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Every government since the NNPC's inception in 1973 has handed the organization over to a select few, who have exploited it for personal gain, leaving a trail of corruption and mismanagement in their wake.

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The author, who has written over 4000 columns, including nearly 70 on the NNPC, has consistently criticized the organization, with recent articles including "NNPC REFINERIES AS A METAPHOR FOR ALL THAT IS WRONG WITH NIGERIA," "NNPCL MIGHT BE IN BIGGER TROUBLE AFTER KYARI," "NNPCL SCANDAL LONG FORETOLD," and "NNPCL's CRUDE OIL PROCESSING CAPACITY."

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In summary, the author's view of the NNPC is that it is a public organization that has been privatized by its directors and managers, who serve the interests of those in power rather than the Nigerian people, making it a racket rather than a genuine company.

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When President Tinubu announced the termination of fuel subsidies and approved the release of $2.3 billion for refinery rehabilitation in 2023, the author warned that the funds would be wasted and looted, a prediction that now seems eerily prescient.

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The "Presidential Executive Order to Safeguard Federation Oil and Gas Reserves and Provide Regulatory Clarity, 2026," also known as Executive Order 9, may have been prompted by the flaws in the Petroleum Industry Act, which was passed in 2021.

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The PIA's drafting process began in 2009 during Yar'Adua's administration, when the late Dr. Rilwan Lukman, Minister of Petroleum Resources, presented a 896-page draft to the President, which was later discovered to have been prepared largely by International Oil Companies.

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The author was tasked with reviewing the draft and producing an executive summary, which revealed that the document was not in the national interest, prompting Yar'Adua to consider major amendments before his terminal illness took him away.

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Jonathan, who took over after Yar'Adua, was persuaded to send the PIA to the National Assembly, despite the author's warnings that it would not be signed into law by May 2011, a prediction that proved correct.

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The author has long advocated for the commercialization and privatization of the oil and gas sector, but believes that the PIA must protect the common interest and not favor a select few or International Oil Companies.

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Executive Order 9, while introducing some transparency and accountability into the NNPC and gas sector, is flawed and may not be the solution to the problems plaguing the industry, with the author arguing that "two wrongs don't make a right."

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The beneficiaries of EO9, as it stands, are likely to be governments, particularly governors completing their second terms, who will receive more funds to manage, but the author warns that the bonanza will not be as large as expected.

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EO9 may have been introduced at the wrong time and in the wrong way, with the author suggesting that it may have been influenced more by political considerations than long-term national interest, given Nigeria's unofficial entry into election campaign mode.

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The introduction of EO9 symbolizes President Tinubu's approach to governance since 2023, which involves announcing courageous policies without fully considering the ramifications, a approach that has led to unwanted repercussions, such as the aftermath of the fuel subsidy removal announcement on May 29, 2023.

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The news report on March 3, 2026, announcing the revised Executive Order, which adjusts the oil revenue remittance framework, demonstrates the error of acting before all the facts are in, with the NNPC set to continue crude lifting and sales on behalf of the government.

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President Tinubu deserves credit for accepting that mistakes have been made and moving quickly to make corrections, but the damage may already be done, with a friend of the author, an investor in the global oil and gas sector, warning that the announcement of EO9 will drive away investors from the Nigerian oil and gas sector for a while.