I have always agreed with Aliko Dangote, I revere his string of business successes and enterprise.
But his recent advice to Buhari to sell off Nigeria’s assets (NLNG and African Finance Corporation), I stand to differ.
Sometimes, managing a private organisation is different from overseeing a public entity.
You do not import the same approach verbatim because you run a large business.
Any decision taken by Dangote affects him and his shareholders which I reckon may not be more than 100,000.
However, Buhari’s action affects 170m people thus requires a social change dimension.
Recall that Buhari has been edging for special powers to enable him sell off the country’s assets to generate about $50bn.
Typical of the Buhari’s administration, I feel they want to use Dangote to fire this salvo to test the waters.
The ownership of NLNG is as follows:
– Nigerian National Petroleum Corporation (NNPC) owns 49%,
– Shell Gas B.V. owns 25.6%,
– Total LNG Nigeria Ltd owns 15% and,
– Eni International owns 10.4%.
It’s a partnership with the Nigerian government as majority shareholder. The equivalent of NNPC in Saudi Arabia is Saudi Aramco.
Given the fall in oil price, the Saudis intend to value Saudi Aramco at $2 trillion with 5% offered to investors.
They have used such idea to keep global investors excited about future prospects of their economy despite the slump in oil price. Why not emulate Saudi Arabia.
Let the current shareholders of NLNG expand their investment and use such funds for projects that will benefit Nigeria. A majority shareholder can instigate such moves.
If we are serious about boosting the Nigerian economy, we should explore such assets like NLNG to establish nothing less than two refineries in the long term.
I believe a well-organised IPO will bring nothing less than $10 billion which will be dedicated to constructing two gigantic refineries that will enable Nigeria to produce all her fuel demands locally.
Is there a jinx or curse on this country that we must import petroleum products?
Meanwhile, it seems Dangote wants to buy off the NLNG;
I will not be against selling the corporation to Nigerians, Dangote inclusive because this will prevent repatriation of dollars.
If sold off to foreigners, we will have another MTN on our hands, much needed forex that should be circulated locally is ferried to other countries on daily basis and we still wonder why the Nigerian economy is always gasping for air.
I really don’t know why this government is often looking for the easiest solutions, instead of institutional re-engineering and organisational change, they want to sell it, OLX.
Selling off your assets and expanding such monies on recurrent expenditures and minimal capital expenditures which will not equal the value of that asset in real terms is a short-term solution that will not add value.
If Buhari and his team begin to think of ways of ensuring we have two more refineries added to Dangote’s by 2019, they can begin to see opportunities in NLNG.
But what this administration will be quick to remind Nigerians are negatives such as hike of petrol price in other oil producing countries.
Even if establishment of refineries is the only legacy Buhari will leave for Nigeria, that is commendable.
I wish this administration will start to think “outside the box” as the president admonished a few days ago before travelling to the 71st United Nations General Assembly at the ministerial retreat.