It was reported that Senator Ifeanyi Ararume had sued President Muhammadu Buhari for N100 billion over his removal as board chairman of the Nigeria National Petroleum Company Limited.
Ararume claims Buhari illegally replaced him in January 2022 when he formed a nine-member board and management of the NNPC Limited.
Buhari appointed Ararume as chairman of the Nigerian oil company’s board in September 2021, but 24 hours before the board’s inauguration, the president suspended it without explanation.
In a subsequent appointment made by the president, Ararume was replaced as chairperson by Margret Chuba Okadigbo, while Mele Kyari was retained as CEO.
The Chairman of the Senate Committee on Local and Foreign Debts has filed a lawsuit against Buhari, claiming that his removal was illegal and unconstitutional.
In the FHC/ABJ/CS/691/2022 suit, the lawmaker asks the Federal High Court to rule on whether his replacement violated provisions of the NNPC Memorandum and Articles of Association, Companies and Allied Matters Act 2010, and the Petroleum Industry Act 2021, among others.
Suppose the suit is decided in his favour. In that case, he wants the court to declare that his position as non-executive Chairman of the NNPC is solely governed and regulated by CAMA 2020, the PIA Act 2021, and the NPPC Memorandum of Association.
What Does The PIA Say?
The Petroleum Industry Act, 2021 was signed into law in August 2021 to provide legal, governance, regulatory, and fiscal framework for the petroleum industry. Its enactment led to the incorporation of NNPC Ltd as a commercial entity whose shares are entrusted with the government.
Under the PIA, President Buhari, the minister of petroleum, heads the industry with a wide range of powers to formulate, monitor, and administer government policies.
Section 14 of the Act highlights the president’s power to suspend or remove members of the NNPC board and conditions that could result in such removal or suspension.
It reads;
A member of the Board of the Commission may be suspended or removed from office by the President, where the member—
(a) is found to be— (I) unqualified for appointment under section 11 of this Act, (ii) unqualified subsequent to his appointment, or (iii) in breach of conflict of interest provisions in the Companies and Allied Matters Act or any regulation regarding conflicts of interest passed under this Act;
(b) ceases to be an employee of the ministry or agency he represents on the Board of the Commission;
(c) has demonstrated an inability to effectively discharge the duties of his office;
(d) has been absent from the meeting of the Board of the Commission for three consecutive times without the consent of the Chairman or in the case of the Chairman, without the consent of the President, except where good reason is shown for the absence ;
(e) is found guilty of serious misconduct by a court or tribunal of competent jurisdiction ; or
(f) has, under the law in force in any country—(1) been adjudged or declared bankrupt or insolvent and has not been discharged, (ii) made an assignment to or arrangement or composition with his creditors which has not been rescinded or set aside, or (iii) been declared to be of unsound mind.