NNPCL Moves to List Shares Amid Transparency Concerns

The Nigerian National Petroleum Company Limited (NNPCL) is set to make history as it moves closer to listing its shares on the capital market, a move mandated by the Petroleum Industry Act (PIA) 2021.

The company’s Chief Corporate Communications Officer, Olufemi Soneye, confirmed this development in a statement released on Thursday in Abuja, signaling that the process is now in its final stages.

This long-anticipated step is seen as a major shift in Nigeria’s oil sector, as it could mark the transformation of NNPCL from a state-run enterprise into a publicly traded company with broader ownership.

The move follows extensive discussions and consultations with stakeholders, including potential investors, regulators, and market analysts.

According to Soneye, NNPCL’s Chief Finance and Investor Relations Officer, Olugbenga Oluwaniyi, shared insights into the company’s preparations during a high-level consultative meeting at the NNPC headquarters.

Oluwaniyi revealed that the company is actively engaging with potential investors through an initiative known as the “NNPC Ltd. IPO Beauty Parade.”

This process, he explained, is designed to ensure compliance with capital market regulations while assessing the best partners to support the company’s transition to a publicly traded entity.

The IPO Beauty Parade, as described by Oluwaniyi, is a structured engagement aimed at vetting potential investors, evaluating their proposals, and selecting the most suitable partners for NNPCL’s public offering.

Key areas of partnership under consideration include Investor Relations, IPO Readiness Advisors, and Investment Banking Partners.

Oluwaniyi emphasized that the company would select firms that offer the most strategic and beneficial proposals in each category, ensuring that the transition is handled efficiently and in line with global best practices.

Despite these assurances, skepticism remains among industry analysts and market watchers.

For years, NNPCL has been criticized for a lack of transparency, with accusations of financial mismanagement and corruption plaguing its operations.

While an Initial Public Offering (IPO) typically allows institutional investors and the public to purchase shares in a company, there are growing concerns that NNPCL’s listing could serve as a mechanism for politically connected individuals and powerful elites to gain control over the company’s lucrative assets.

The Petroleum Industry Act stipulates that NNPCL must list its shares on the capital market in compliance with the Company and Allied Matters Act of 1990.

However, questions remain over whether the listing will genuinely democratize ownership or simply reinforce existing power structures within Nigeria’s oil industry.

Several financial experts have warned that without robust oversight, the process could result in a scenario where only a select few benefit, while the broader Nigerian public sees little to no impact from the company’s transition.

Critics argue that NNPCL’s long history of opacity could hinder true public participation in the shareholding structure.

They point to previous privatization efforts in Nigeria, where state-owned enterprises were sold off under the pretense of economic reform, only to end up in the hands of politically connected individuals.

Meanwhile, some proponents of the listing argue that opening NNPCL to private investment could enhance efficiency, improve corporate governance, and reduce government interference in its operations.

They believe that a publicly traded NNPCL would be subject to greater scrutiny, thereby improving accountability and transparency.

Nonetheless, there is still uncertainty regarding how shares will be allocated and whether retail investors—ordinary Nigerians—will have fair access to ownership.

Market analysts suggest that for the IPO to be successful and credible, NNPCL must ensure an inclusive and transparent process that prioritizes broad-based participation.

They recommend that the company adopt clear guidelines on share allocation, disclose financial records, and allow for independent oversight to prevent undue political influence.

As the company moves closer to its IPO, all eyes are on the regulators and policymakers overseeing the process.

The Nigerian Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NGX) are expected to play a key role in ensuring that the listing adheres to international best practices.

The coming weeks will be crucial as NNPCL finalizes its preparations and determines the specifics of the public offering.

Many Nigerians will be watching closely, hoping that this transition brings genuine reforms rather than serving as another avenue for wealth consolidation among the country’s elite.

The outcome of this listing could set a precedent for future privatization efforts in Nigeria and shape the trajectory of the country’s oil and gas sector for years to come.