Farouk Ahmed: Driving Growth and Sustainability At NMDPRA

By Comrade Kabir Matazu In 2021, a new chapter unfolded in Nigeria’s petroleum industry with the establishment of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). Led by the visionary Engr. Farouk Ahmed, NMDPRA embarked on a mission to reshape the industry, ensuring it operates with efficiency, effectiveness, and sustainability at its core. The […]

By Comrade Kabir Matazu

In 2021, a new chapter unfolded in Nigeria’s petroleum industry with the establishment of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). Led by the visionary Engr. Farouk Ahmed, NMDPRA embarked on a mission to reshape the industry, ensuring it operates with efficiency, effectiveness, and sustainability at its core. The Petroleum Industry Act (PIA) 2021 provided a new regulatory and governance framework for the industry, and NMDPRA has been working tirelessly to implement its provisions.

NMDPRA’s vision is to enhance lives through effective regulation of the midstream and downstream petroleum industry, and its mission is to be a world-class regulator promoting economic and social development through sustainable energy. With a focus on transparency, accountability, professionalism, integrity, innovation, and teamwork, NMDPRA has created an enabling environment that drives sustainable development across Nigeria’s midstream and downstream value chain.

The Authority has taken significant steps to deliver world-class service to oil and gas stakeholders through effective regulatory oversight. Under Engr. Ahmed’s leadership, NMDPRA has become a driving force for economic and social development in Nigeria’s petroleum industry. By accelerating and deepening economic development, NMDPRA ensures sufficient product distribution and supply at fair prices, benefiting both the industry and the Nigerian people.

One of NMDPRA’s notable achievements is the end of fuel shortages during festive periods, which has brought relief to millions of Nigerians. The growth of domestic refining capacity, particularly with the Dangote Refinery and NNPCL plants, is also a significant milestone. These developments have not only increased Nigeria’s refining capacity but also reduced the country’s reliance on imported petroleum products.

The expansion of Nigeria’s compressed natural gas (CNG) market is another area where NMDPRA has made significant progress. The Authority has attracted over $400 million in investment for new fueling stations, while CNG vehicle conversion centers have increased Nigeria’s conversion capacity by over 2,500%. This development has the potential to reduce the country’s dependence on traditional fuels, promote cleaner energy, and drive economic growth.

NMDPRA has also been instrumental in promoting consumer protection, transparency, and support for the Decade of Gas initiative, which aims to industrialize the country through natural gas. The Authority’s collaboration with the Securities and Exchange Commission (SEC) to issue licenses to JEX Market to establish and operate a Gas Clearing House and Settlement Authorization Platform is a game-changer for the industry. This platform will enable the trading of natural gas and its derivatives in Nigeria, promoting efficiency, transparency, and economic growth.

The licensing of 83 refineries by NMDPRA is another significant achievement that could enable Nigeria to achieve full petroleum export status within two years. The combined refining capacity of these refineries is 1,124,500 barrels per day, which is a major boost to the country’s economy. Industry experts have emphasized the need for adequate crude oil supply to sustain local refineries, and the progress made so far is evident in the reduction of petrol imports.

The Authority’s efforts to attract investment in the industry have also yielded significant results. The Industry Sustainability Initiative (NISI) has created over $575 billion in capital investment opportunities for Nigeria through decarbonization of operations. NISI is designed to align with the Global Sustainability Development Goals, focusing on reducing emissions, enhancing health and well-being, ensuring affordable and clean energy, and promoting safety and responsible economic growth.

NMDPRA’s commitment to environmental sustainability and safety is evident in its introduction of new regulations in 2023, aimed at addressing pressing concerns in the midstream and downstream petroleum sectors. These regulations have ensured that environmental standards and practices are upheld, safety measures are prioritized, and petroleum facilities are decommissioned and abandoned in a responsible manner.

The Authority’s reforms have enabled it to operate with efficiency, effectiveness, and transparency, earning widespread recognition as a world-class regulator. NMDPRA’s commitment to excellence has yielded impressive results, including ensuring energy security for the country through the supply of feedstock to domestic refineries, gas-based industries, and midstream facilities. The Authority’s efforts have also mitigated the negative effects of the removal of petroleum subsidy, ensuring price stability, adequate product supply, and eliminating queues.

Through the Petroleum Industry Stakeholders’ Forum (PISF), NMDPRA has created a platform for periodic engagement with stakeholders, addressing industry challenges, formulating effective policies, and enhancing regulatory efficiency. The PISF has enabled the Authority to identify areas for improvement and develop tailored solutions to drive inclusive growth and development in the petroleum sector. By fostering a collaborative environment, NMDPRA has promoted inclusivity, growth, sustainability, and investment in the industry, cementing its position as a key driver of Nigeria’s socioeconomic development.

In addition, NMDPRA has taken a pioneering step in establishing a petroleum products pricing reference hub for West Africa, promoting transparency, stability, and efficiency in the regional petroleum market. Under Engr. Ahmed’s leadership, the Authority has driven the growth and development of Nigeria’s petroleum industry, earning him widespread recognition and admiration. His extensive experience and leadership have been instrumental in shaping the midstream and downstream petroleum sector, and his reappointment for a second tenure by President Bola Ahmed Tinubu is a testament to his exceptional performance.

Despite allegations of embezzlement and conflict of interest against Engr. Farouk Ahmed, a closer examination reveals a different narrative. The NMDPRA has been instrumental in driving growth, sustainability, and investment in the petroleum sector, with numerous achievements that have positively impacted the Nigerian economy. The allegations appear to be baseless and lacking in substance, and it is worth noting that the NMDPRA has been transparent in its operations.

The Authority’s commitment to promoting economic growth and development is evident in its efforts to stabilize the energy sector, promote gas utilization, and support industrialization. By championing gas utilization as a tool for industrialization and economic growth, NMDPRA has helped drive industrialization and economic development, cementing its role as a key player in Nigeria’s energy landscape.

This notable achievements however underscores a careful formulation of policy direction with inputs from key relevant stakeholders in the petroleum industry with careful and deliberate implementation of same, the resultant effects has saved the country over 670billion naira annually from refined petroleum imports. Some experts put the figures around 26billion usd in dollar terms thereby remarkably reducing pressure on the Nigerian Foreign Exchange (FOREX) earnings.

 

Comrade Kabir Matazu is a Public Affairs Commentator