• Fri. Sep 29th, 2023

NNPC expands its downstream oil assets; acquires Oando subsidiary, OVH Ltd


Oct 2, 2022

By Bassey Udo 

The Nigerian National Petroleum Company (NNPC) Limited has expanded its downstream oil industry assets with the announcement of the acquisition of the OVH Energy Marketing Limited downstream assets.

OVH Limited, which is the downstream subsidiary of Oando Group, operates a chain of filling stations and other downstream petroleum industry assets, including a reception jetty with about 240,000 metric tonnes monthly capacity, eight liquefied petroleum gas plants, three lubes blending plants, three aviation depots, and 12 warehouses.

The NNPC said on Saturday in Abuja that the acquisition of the assets was aimed at helping the company, which recently  transformed into a publicly quoted commercial oil entity in the petroleum industry, realise its aspiration to become a leading downstream energy firm in Nigeria and the entire West African sub-region. 

The Group Chief Executive officer of NNPC Limited, Mele Kyari said with the acquisition, OVH Energy/Oando branded retail service stations would be rebranded and fully integrated into NNPC’s brand by the end of 2023.

Kyari said the merger was achievable through NNPC Limited’s “robust system and network aimed at becoming the largest downstream company with a robust network not only in Nigeria and the West African sub-region, but Africa as a whole,” he said.

“This is a vehicle to ensure the NNPC delivers on the energy transition in the country. We will use the assets to deliver Liquefied Petroleum Gas (LPG) and Compressed Natural Gas (CNG) into the market and also to poor citizens who rely on biomass to cook and discharge other domestic chores,” he said.

Kyari who observed that 70 percent of Nigerians do not have access to clean cooking fuel, said the newly acquired assets would provide the people access to the energy supply value chain.

The chairman of the Board of the NNPC Limited, Margery Okadigbo, said the acquisition was under an Accelerated Network Expansion (ANEX) Initiative, to help strengthen NNPC’s downstream business portfolio, enhance profitability and guarantee national energy security agenda.

Okadigbo said the acquisition would expand NNPC’s fuel distribution network with over 380 additional filling stations under its retail brand in Nigeria and Togo, towards the company’s journey to attain its targets of 1,500 stations across the country.

“We will be the largest petroleum product retail network in Africa,” she said.

“OVH has given us so much to look forward to, after the investment we have made on the package to continue to work with us,” she said.

The CEO of OVHEM Limited,Huub Stokman, said the company was excited about the future potentials and capabilities of the combined entity and was ready to bring efficiency to the leading business.

“OVH Energy has enriched Nigeria’s downstream sector and established an unparalleled supply footprint, distributing over one billion litres of refined petroleum products annually,” he said.

Stokman said the acquisition by NNPC Limited came at a critical time in the Nigerian energy sector and in light of the enactment of the Petroleum Industry Act 2021 (PIA),” he said. 

“As the demand is still increasing, also there should be deliberate effort to increase the supply in consumption of natural gas energy transition.”

The Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, and the Executive Vice Chairman, Federal Competition and Consumer Protection Commission, Babatunde Irukera,  were also at the formal unveiling of the acquired assets. 

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