Divestment of 60% Mobil Oil stake on technical reasons – NIPCO Boss

Mr Venkataraman Venkatapathy, Managing Director, Nigerian Independent Petroleum Company (NIPCO) on Wednesday said technical reasons were part of the Mobil Oil Nigeria (MON) 60 per cent divestment to the company.

Venkatapathy, disclosed this during a news conference in Lagos that the divestment was done in good faith to promote indigenous company like NIPCO.

NIPCO announced the acquisition of 60 per cent stake in the downstream operation of MON which was agreed on after the execution of a Sales and Purchase Agreement with Exxon Mobil.

Mobil only diverted 60 per cent interest in one of its companies because of bankruptcy and the business of downstream business in Nigeria being for “small boys”.

“ExxonMobil are very much alike in Nigeria with concern in the upstream, midstream and lubricant blending.

“It was divested for technical reasons and we are still in partnership with ExxonMobil on lubricant and their brands.

“The brand will continue both in lubricants and fuel,’’ Venkatapathy said.

According to him, MON will continue to run as a separate, distinct and independent company from NIPCO Plc, adding that each with its own CEO that will report to its Board of Director.

According to him, “in our usual way of attaching premium to staff welfare, Nipco shall respect the terms of all collective agreements with employees and the unions that represent them (PENGASSAN and NUPENG).

“All employees are assured of job safety as there is no plan for staff redundancies.”

On the value of the 60 per cent equity, Venkatapathy said that confidentiality clause in the agreement had forbidden him from making such disclosure.

He said that the funds secured for the 60 per cent stake were gotten from equities and loans.

“In addition to giving the employees much needed assurances on their job safety which we did today, our goal is to increase presence and efficiency by expanding MON’s retail footprint to a minimum of 300 by December 2017.

“We urged MON personnel to the new roadmaps for growth while simultaneous exploring opportunities to provide MON with additional products like LPG.

“NIPCO’s successful philosophy and track record of supporting and empowering its staff and management team will continue at MON.

“Staff welfare and comfort will be paramount and receive priority as we forge ahead,’’ he added.

The managing director said that NIPCO would continue to maintain the Mobil brand on its retail outlets and continue to blend and sell its lubricants under branding licence(s) from Exxon Mobil.

He expressed the company’s gratitude to Exxon Mobil for selecting NIPCO as the preferred bidder for the acquisition of MON.

“We will ensure full brand compliance with ExxonMobil’s global standards as well as rigorously sustain and follow ExxonMobil’s code of conduct/ethos and operational excellence,” Venkatapathy said.