NIGERIA - The OPEC Countries - Part 8.

Decision making for the oil sector has undergone considerable upheavals in the past two decades, as the leadership of the country shifted between civilians and military men. The instability caused by successive coups and re-installations of democratic governments came to an end in 1999, when President Olusegun Obasanjo came to power with global support led by the US and Britain.

A democrat and a reform minded figure with a long political career in Nigeria, Obasanjo has been trying to bring about changes to the oil sector in the country and to stabilise the process for making decisions related to oil. Under the military regimes, the decision making process for petroleum was unstable. Most related deals used to go through people connected to the military in one way or another. There used to be numerous administrative changes in the oil ministry, Nigerian National Petroleum Co. (NNPC) and the other institutions based on the whim of military leaders, while corruption was widespread. Before Obasanjo came to power, successive regimes had squandered over $280 bn of oil revenues in the past 27 years.

The men in charge of petroleum policy in Nigeria at present are President Obasanjo and his top energy advisor Rilwanu Lukman, a force behind OPEC's price defence strategy. Next are Funsho Kupolokun, special presidential assistant on petroleum affairs, and Vice President Atiku Abubakar. Below them comes Jackson Gaius-Obaseki, Group Managing Director of NNPC.

NNPC was formed in 1977 from a merger of the state-owned Nigerian National Oil Corp. and the former ministry of petroleum resources. NNPC's superstructure consists of a group managing director and six group executive directors. Plans to privatise the refining and petrochemical subsidiaries of NNPC and deregulate the fuels market have been floated since Obasanjo came to power.

The NNPC group executive directors are in charge of six directorates which oversee its subsidiaries, as follows: (1) The E&P Directorate, with upstream departments, National Petroleum Investment Management Services which oversees the oil producing JVs, a group which monitors the PSAs, Nigerian Petroleum Development Co., and NAPIMS which produce oil and gas from some fields, Integrated Data Services which provides seismic and reservoir evaluation services, and Nigerian Gas Co. which supplies the local market with gas and handles the national gas pipelines. (2) The Processing Directorate, with four subsidiaries including the Kaduna Refining & Petrochemicals Co., the Warri Refining & Petrochemicals Co., the Eleme Petrochemicals Co., and the Port Harcourt Refining Co. (3) The Engineering & Technical Directorate, with the subsidiary Nigerian Engineering & Technical Co., which was once a JV with Bechtel. (4) The Commercial & Investment Directorate, in charge of the Products and Pipeline Marketing Co., which markets and distributes oil products in Nigeria, and Hyson Nigeria which is a JV with Dutch trader Vitol marketing oil products in West Africa. (5) Finance & Accounts, with the help of the World Bank now issues externally audited accounts. (6) The Corporate Services Directorate.