The federal government has been urged to prioritise the listing of the NNPC on the NSE as part of its Economic Sustainability Plan.
By Chinyere Joel-Nwokeoma
The federal government has been urged to prioritise the listing of the Nigerian National Petroleum Corporation (NNPC) on the Nigerian Stock Exchange (NSE) as part of its Economic Sustainability Plan.
Uche Uwaleke, Professor of Capital Market at the Nasarawa State University Keffi, said this on Monday in an interview with the News Agency of Nigeria (NAN) in Lagos.
He said listing of NNPC on the NSE “has become necessary especially now that the corporation has announced plans to diversify into other business areas such as power, health care and agriculture.”
Uwaleke said offering part of shares of NNPC for sale on the Exchange would help government reduce its fiscal deficit and borrowing.
He noted that it would enable the government raise money to finance the capital component of the 2020 budget.
Uwaleke, who is also the president of the Association of Capital Market Academics of Nigeria, said the development would strengthen the stock market by attracting both domestic and foreign investors.
According to him, it will also open the doors for other companies to be listed on the nation’s bourse.
“It will also improve the governance and transparency of the corporation which not a few consider opaque,” Uwaleke stated.
He said the federal government should take a cue from the experience of the Saudi Arabia government which in December 2019, successfully sold part of its shares in the country’s oil company.
Uwaleke stated that the government of Saudi Arabia sold part of its shares in Aramco on the Saudi Arabia’s stock exchange and raised a lot of money in the process.
He added that the government should sell part of its stakes in the Nigerian Liquefied Natural Gas Company on the Exchange, while still maintaining its majority shareholding.
“Currently, the federal government has 49 per cent equity in the LNG company while the remaining shares are held by Shell Gas (25.6 per cent), Total (15 per cent) and Eni International (10.4 per cent),” he said.
NAN reports that NNPC recently disclosed plans to diversify into a number of business portfolios as part of measures to cope with the volatility in the global crude oil market and to sustain revenue generation for the country.
Dr Kennie Obateru, NNPC Group General Manager, Group Public Affairs Division, said in a statement that the corporation was making plans to diversify into power, medical, housing and other sectors to strengthen the profitability of the national oil company. (NAN)
