State ownership , also called public ownership or government ownership , is the ownership of an industry , asset , property , or enterprise by the national government of a country or state , or a public body representing a community, as opposed to an individual or private party . Public ownership specifically refers to industries selling goods and services to consumers and differs from public goods and government services financed out of a government's general budget . Public ownership can take place at the national , regional , local , or municipal levels of government; or can refer to non-governmental public ownership vested in autonomous public enterprises . Public ownership is one of the three major forms of property ownership, differentiated from private, collective / cooperative , and common ownership .
36-540: The Nigerian National Petroleum Company (NNPC) Limited is a state-owned oil company in Nigeria . Still a fully-owned government company, it was transformed from a corporation into a limited liability company in July 2022. NNPC Limited is the only entity licensed to operate in the country's petroleum industry . It partners with foreign oil companies to exploit Nigeria's fossil fuel resources. The NNPC, with an asset of $ 153B (USD),
72-402: A not-for-profit corporation , as it may not be required to generate a profit; as a commercial enterprise in competitive sectors; or as a natural monopoly . Governments may also use the profitable entities they own to support the general budget. The creation of a state-owned enterprise from other forms of public property is called corporatization . In Soviet-type economies , state property was
108-399: A broadly commercial manner and may or may not have monopolies in their areas of activity. The transformation of public entities and government agencies into government-owned corporations is sometimes a precursor to privatization . State capitalist economies are capitalist market economies that have high degrees of government-owned businesses. Public ownership of the means of production
144-453: A family is allocated an apartment that is state owned, it will have been granted a tenancy of the apartment, which may be lifelong or inheritable, but the management and control rights are held by various government departments . There is a distinction to be made between state ownership and public property. The former may refer to assets operated by a specific state institution or branch of government, used exclusively by that branch, such as
180-640: A number of foreign multinational corporations , which include Royal Dutch Shell , Agip , ExxonMobil , TotalEnergies , Chevron , and Texaco (now merged with Chevron). Through collaboration with these companies, the Nigerian government conducts petroleum exploration and production. The NNPC Towers, located in Abuja , serves as the headquarters of the Nigerian National Petroleum Corporation (NNPC). The complex consists of four identical towers and
216-879: A recruitment scheme and since then, until date the NNPC recruitment have been a yearly scheme. The NNPC Group comprises the NNPC Board , the group managing director's office, Five directorates as listed below. Each of the directorate is headed by an executive vice president (EVP). Its divisions are headed by chiefs, while its subsidiary companies are headed by managing directors. NNPC has several subsidiaries, two partly owned subsidiaries and 16 associated companies. Directorates: Strategic Business & Corporate Services Units: NNPC acquired Oando's OVH Energy in September 2022 and took over its 380 filling stations. NNPC has sole responsibility for upstream and downstream developments. In 1988,
252-608: A research laboratory. The latter refers to assets and resources owned by the population of a state which are mostly available to the entire public for use, such as a public park (see public space ). In neoclassical economic theory , the desirability of state ownership has been studied using contract theory . According to the property rights approach based on incomplete contracting (developed by Oliver Hart and his co-authors), ownership matters because it determines what happens in contingencies that were not considered in prevailing contracts. The work by Hart, Shleifer and Vishny (1997)
288-431: Is a subset of social ownership , which is the defining characteristic of a socialist economy. However, state ownership and nationalization by themselves are not socialist, as they can exist under a wide variety of different political and economic systems for a variety of different reasons. State ownership by itself does not imply social ownership where income rights belong to society as a whole. As such, state ownership
324-414: Is a tool to consolidate the means of production as a precursor to the establishment of economic planning for the allocation of resources between organizations, as required by government or by the state. State ownership is advocated as a form of social ownership for practical concerns, with the state being seen as the obvious candidate for owning and operating the means of production. Proponents assume that
360-594: Is only one possible expression of public ownership, which itself is one variation of the broader concept of social ownership. In the context of socialism, public ownership implies that the surplus product generated by publicly owned assets accrues to all of society in the form of a social dividend , as opposed to a distinct class of private capital owners. There is a wide variety of organizational forms for state-run industry, ranging from specialized technocratic management to direct workers' self-management . In traditional conceptions of non-market socialism, public ownership
396-470: Is ranked seventh (7th position) on LinkedIn 's 25 best companies to work in Nigeria in 2023. State-owned In market-based economies, state-owned assets are often managed and operated as joint-stock corporations with a government owning all or a controlling stake of the company's shares . This form is often referred to as a state-owned enterprise . A state-owned enterprise might variously operate as
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#1733106653787432-606: Is situated on Herbert Macaulay Way in the Central Business District of Abuja . NNPC also maintains zonal offices in cities including Lagos , Kaduna , Benin City, Port Harcourt , and Warri . Additionally, it operates an international office in London , United Kingdom. In October 2019, NNPC announced the signing of a $ 2.5 billion pre-payment agreement with Nigeria LNG to fund upstream gas development projects. In December 2021,
468-611: Is the largest national oil company in Africa. The company boasts of extensive infrastructure and investment in the downstream, midstream and upstream of the Nigerian petroleum industry . NNPC was established on 1 April 1977 as a merger of the Nigerian National Oil Corporation and the Federal Ministry of Petroleum and Energy Resources. NNPC by law manages the joint venture between the Nigerian federal government and
504-411: Is the leading application of the property rights approach to the question whether state ownership or private ownership is desirable. In their model, the government and a private firm can invest to improve the quality of a public good and to reduce its production costs. It turns out that private ownership results in strong incentives to reduce costs, but it may also lead to poor quality. Hence, depending on
540-475: Is the process of transferring private or state assets to a municipal government. A state-owned enterprise is a commercial enterprise owned by a government entity in a capitalist market or mixed economy . Reasons for state ownership of commercial enterprises are that the enterprise in question is a natural monopoly or because the government is promoting economic development and industrialization . State-owned enterprises may or may not be expected to operate in
576-511: The Federal Government of Nigeria and NNPC Ltd signed a ₦621 billion Memorandum of Understanding to finance the construction of critical road infrastructure across the country. Following passage of a Petroleum Industry Act in August 2021, NNPC now operates as a commercial entity without relying on government funding and direct controls. NNPC was established as a limited liability corporation in
612-490: The Hart-Shleifer-Vishny model assumes that the private party derives no utility from provision of the public good. Besley and Ghatak (2001) have shown that if the private party (a non-governmental organization) cares about the public good, then the party with the larger valuation of the public good should always be the owner, regardless of the parties' investment technologies. More recently, some authors have shown that
648-552: The NNPC accounts for 76% of federal government revenue and 40% of the entire country's GDP . As of 2000, oil and gas exports account for 98% of Nigerian export earnings. The efforts of the Mallam Mele Kyari-led Management of the Nigerian National Petroleum Corporation (NNPC) to entrench the culture of transparency in the system have begun to receive recognition with the Corporation named as the “Government Agency of
684-929: The Nigerian National Petroleum Company Limited (NNPCL) with effect from December 1, 2023. 1. Chief Pius Akinyelure — Non-Executive Board Chairman (Former Executive Director, Mobil Oil) 2. Mele Kyari — Group Chief Executive Officer 3. Umar Ajiya — Chief Financial Officer 4. Mr. Ledum Mitee — Non-Executive Director 5. Mr. Musa Tumsa — Non-Executive Director 6. Mr. Ghali Muhammad — Non-Executive Director 7. Prof. Mustapha Aliyu — Non-Executive Director 8. Barr. David Ogbodo — Non-Executive Director (Former NNPC Group General Manager, Downstream Investments) 9. Ms. Eunice Thomas — Non-Executive Director The NNPC's business operations are managed through Strategic Business and Corporate Services Units (SBUs/CSUs) in diverse locations across Nigeria. In that case; The Nigerian National Petroleum Corporation initiated
720-514: The Oil and Gas Industry. Speaking at the inauguration of the NNPC-NEITI Joint Committee on Mainstreaming and Remedial Issues, group managing director of NNPC, Kyari, said the joint committee was part of efforts to further deepen the robust history of collaboration that both organisations had enjoyed over the years. He said NNPC was in complete sync with the activities of NEITI because it was
756-692: The US followed by Russia and then Canada. The aggregate value of Upstream E&P assets available for sale (Deals in Play) reached a record-high of $ 135 billion in Q3 2013. The value of Deals in Play doubled from $ 46 billion in 2009 to $ 90 billion in 2010. With ongoing M&A activity, the level remained almost the same, reaching $ 85 billion in December 2012. However, the first half of 2013 saw approximately $ 48 billion of net new assets coming on
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#1733106653787792-719: The Year 2020 (Transparency)” by the New Telegraph. In keeping with the Transparency, Accountability, and Performance Excellence (TAPE) agenda of the Mele Kyari-led management of the Nigerian National Petroleum Corporation (NNPC), the corporation and the Nigeria Extractive Industries Transparency Initiative (NEITI) have set up a joint committee to deepen collaboration in order to promote transparency in
828-474: The available investment technologies, there are situations in which state ownership is better. The Hart-Shleifer-Vishny theory has been extended in many directions. For instance, some authors have also considered mixed forms of private ownership and state ownership. In the Hart-Shleifer-Vishny model it is assumed that all parties have the same information, while Schmitz (2023) has studied an extension of their analysis allowing for asymmetric information . Moreover,
864-506: The corporation was commercialised into 11 strategic business units, covering the entire spectrum of oil industry operations: exploration and production, gas development, refining , distribution, petrochemicals , engineering , and commercial investments. According to the Nigerian constitution, all minerals , gas , and oil the country possesses are legally the property of the Nigerian Federal Government. The revenue gained by
900-408: The creation of Clause IV of the "Labour Party Manifesto" in 1918. "Clause IV" was written by Fabian Society member Sidney Webb . When ownership of a resource is vested in the state, or any branch of the state such as a local authority , individual use "rights" are based on the state's management policies, though these rights are not property rights as they are not transmissible. For example, if
936-409: The dominant form of industry as property. The state held a monopoly on land and natural resources, and enterprises operated under the legal framework of a nominally planned economy , and thus according to different criteria than enterprises in market and mixed economies. Nationalization is a process of transferring private or municipal assets to a central government or state entity. Municipalization
972-576: The first time in its history is laudable. Just as the executive director of the global Extractive Industries Transparency International's (EITI), Mr. Mark Robinson, commended the corporation for setting a new standard of reporting. Also, Publicity Secretary of the Nigerian Association of Petroleum Explorationists (NAPE), Mr. Lateef Amodu, said, in one year, Kyari has been able to stabilise the industry through robust policies that have helped stakeholders make informed investment decisions. NNPC Limited
1008-463: The hopes that a private entity will find it easier to access international capital markets. The company will continue to ensure energy security in Nigeria. On 27 June 2024, it delivered its first DES LNG Cargo at Futtsu , Japan. President Buhari appointed Mele Kyari as the new group managing director (GMD) now known as the group chief executive officer(GCEO) of NNPC. Kyari replaces Maikanti Baru. Late Dr. Maikanti Baru (7 July 1959 – 29 May 2020)
1044-622: The investment technology also matters in the Besley-Ghatak framework if an investing party is indispensable or if there are bargaining frictions between the government and the private party. Upstream (oil industry) The oil and gas industry is usually divided into three major sectors: upstream (or exploration and production - E&P ), midstream and downstream . The upstream sector includes searching for potential underground or underwater crude oil and natural gas fields, drilling exploratory wells, and subsequently operating
1080-881: The market. Remarkably, the total value of Deals in Play in Q3 2013 nearly tripled over 2009 to $ 46 billion, in less than four years. This categorization comes from value chain concepts, even before formal development of Value Chain Management. A company that owns and operates drilling rigs that are contracted by an operator to drill wells. Examples include Patterson UTI, Trans-ocean, Nabors, Independence Contract Drilling and Cactus. A company that has upstream as well as downstream operations. Examples include Saudi Aramco , ExxonMobil , BP , Shell , ChevronTexaco and SOCAR . A company that has either upstream or downstream operations, but not both. Examples include Anadarko Petroleum , Sunoco , Phillips 66 , ConocoPhillips and Murphy Oil . A company that provides products and/or services to
1116-511: The oil and gas industry. Usually a combination of labor, equipment, and/or other support services. Examples include Schlumberger , Halliburton , Saipem and Baker Hughes . A company that specializes in the sale and distribution of equipment to the oil and gas industry. Examples include Siemens , Schneider Electric and ABB . Many major security companies take part in securing the industry. ISO 14224 defines "Upstream" in its definition section as: 3.98 upstream business category of
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1152-537: The process of capital accumulation and structure of wage labor. Engels argued that state ownership of commercial industry would represent the final stage of capitalism, consisting of ownership and management of large-scale production and manufacture by the state. Within the United Kingdom, public ownership is mostly associated with the Labour Party (a centre-left democratic socialist party), specifically due to
1188-432: The right of the over 200 million Nigerians who are the shareholders of the corporation to know everything about the operations of their company. Stakeholders continue to commend the commitment and speed with which the NNPC boss has been carrying out his assignment. According to the head of Nigeria's extractive industry watchdog NEITI, Waziri Adio, the decision of NNPC to make public its audited accounts on its website for
1224-577: The state, as the representative of the public interest , would manage resources and production for the benefit of the public. As a form of social ownership, state ownership may be contrasted with cooperatives and common ownership. Socialist theories and political ideologies that favor state ownership of the means of production may be labelled state socialism . State ownership was recognized by Friedrich Engels in Socialism: Utopian and Scientific as, by itself, not doing away with capitalism, including
1260-403: The wells that recover and bring the crude oil or raw natural gas to the surface. The upstream industry has traditionally experienced the highest number of Mergers, Acquisitions (M&A) and Divestitures. M&A activity for upstream oil and gas deals in 2012 totaled $ 254 billion in 679 deals. A large chunk of this M&A, 33% in 2012, was driven by the unconventional/shale boom especially in
1296-536: Was the former group managing director (GMD). He was appointed group managing director on 4 July 2016, under the presidency of Muhammadu Buhari ; he succeeded Dr. Emmanuel Ibe Kachikwu , the Nigerian Minister of State for Petroleum (2015–2019). In compliance with Section 59 (2) of the Petroleum Industry Act, 2021, President Bola Tinubu has approved the appointment of a new Board and Management team for
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