Oando: Wale Tinubu and Mofe Boyo Win The Battle, But The War Rages


With the unanimous vote by the  shareholders of Oando PLC expressing confidence in the management team led by the Group Chief Executive Officer, Wale Tinubu, and retaining the company’s Board of Directors at its AGM in Uyo, Akwa Ibom State recently,  Tinubu and his deputy, Mofe Boyo, have weathered the storm stirred by two petitioners, but the war rages as they continue in the task of consolidating the position of this indigenous integrated energy company as a key player in the Nigerian economy, writes Kunle Aderinokun

For Mr. Wale Tinubu, the Group Chief Executive Officer of Oando PLC, and his deputy, Mr. Mofe Boyo, the unanimous endorsement of their leadership of the company and the retention of its board by shareholders at its AGM in Uyo, Akwa Ibom State recently, were a vote of confidence in their stewardship and capacity to continue to consolidate the position of the company in the Nigerian economy. The stakeholders’ unanimous endorsement came at a time two petitioners, Alhaji Dahiru Mangal and Gabriele Volpi of Ansbury Inc., were seeking their exit from the company, a development that put the company in the eye of the storm going by the fact that it’s coming at a time when the oil and gas industry is not finding it so good, given the challenges with oil pricing in recent years. While oil prices are gradually rising now with crude sold at $56.75 per barrel at the weekend, they had hitherto remained at their lowest for a prolonged period and the resultant effects are still being felt by countries of the world.

In Nigeria, apart from the industry’s technical issues, their operations have been hampered by low financing from banks. Banks, which have been hugely exposed to the oil companies, are now reluctant to advance them additional credits, especially with liquidity challenges in the economy.

Apparently against this background, the company’s shareholders voted unanimously for the endorsement of the team that had ensured the resilience of the company amid the challenges that have bedeviled the global oil market, the Nigerian economy and most recently, the backlash it is receiving in the media by the actions of the two petitioners.

On July 14, 2017 an ongoing Securities and Exchange Commission investigation into Oando PLC brought by the two petitioners was leaked and aired on Channels TV. According to the TV report, the petitioners alleged gross abuse of corporate governance and financial malpractices in Oando and questioned the shareholding structure of the company following the acquisition of ConocoPhillips Nigeria.

The first petitioner is Alhaji Dahiru Mangal a 4 per cent shareholder in Oando PLC.  In his petition to SEC, he indicated that he holds 17.9 per cent interest in Oando. However, the company, in its statement, said that, “based on its register of members maintained by, First Registrars & Investor Services Limited, he owns approximately 4 per cent of Oando PLC’s shares in his personal capacity. He is yet to disclose beneficial ownership of 13.9 per cent in accordance with Section 95 of the Companies and Allied Matters Act, Cap. C20 LFN 2004 (‘CAMA’); failure to do so is a violation of CAMA and this has been flagged by the company in writing to Alhaji Mangal and the SEC since Wednesday, 24th May, 2017”.

Alhaji Mangal, who media reports had claimed to have had a brush with the Economic and Financial Crimes Commission (EFCC) under the leadership of Malam Nuhu Ribadu over allegations of smuggling, is a businessman with interests in textile, aviation and logistics, among others.

To date, Alhaji Mangal is yet to prove his said ownership of 13.9 per cent additional Oando shares. Sources said his claim stems from his desire to take over key Nigerian businesses.

The second petitioner, Gabriele Volpi of Ansbury Inc. according to Oando, is not a shareholder of the company, but a shareholder in a company domiciled in a jurisdiction outside Nigeria, which in turn holds shares in a Nigerian investment company by the name of Ocean and Oil Development Partners (OODP) that is a shareholder in Oando PLC.

Volpi claims to have made an equity investment towards Oando’s purchase of ConocoPhillips Nigeria assets through the holding company, OODP in the British Virgin Islands and is currently challenging the terms of his investment in the holding company.

Volpi, an Italian, has over the years dominated the Nigerian oil and gas logistics services through his company, Intels. The company was granted sole concession to operate terminals at Onne, Calabar, Eko and Warri Ports to the dismay of other local players such as Ladol and has allegedly been running a cartel along with powerful senior government officials.

When in April 2015, former president, Goodluck Jonathan, gave a directive that Intels should have exclusive control over all oil and gas cargoes at its terminals in Onne, Warri and Calabar, other logistics companies such as Ladol and Julius Berger, were unhappy about this directive. Ladol, which felt the directive was against the concession agreement it entered with the government and therefore inimical to its interest, responded with a lawsuit against the government.

Intels has basically held the entire ports sector to ransom, controlling and in most cases successfully pushed out competition, in some instances, the competition haven’t even been able to make a start because of high market entry costs and legal restrictions. Volpi’s evident stronghold is as a result of most cargoes in the sector being directed to his terminals for discharge allegedly by government agencies saddled with the responsibility of regulating port operations. Just recently, the Nigerian Ports Authority (NPA) took a decision to break Intels’ monopoly in the handling of oil and gas shipment.

While Volpi is accusing Oando CEO, Wale Tinubu, and his deputy, Mofe Boyo, of financial mismanagement, he had been named in an Italian investigation. An Italian newspaper Giornalistica Repubblica reported that the investigations by Trani and Syracuse prosecutors into the existence of an international conspiracy aiming to destabilise the leadership of Eni, an Italian energy giant, were part of a wider investigation into illegal trafficking of waste and precious stones.

The article named Volpi, “Sani Abutcha” (presumably Mohammed Abacha), and a certain “Pesal” – a Nigerian company linked to deceased former governor of Bayelsa State, Diepreye Alamieyeseigha. Apart from that, Volpi was named in a United States Senate investigation into allegations of money laundering against a former Nigerian top official.

Oando, in a press statement faulting Volpi’s claim, clarified that Volpi via Ansbury Inc. was not even a direct shareholder in the company.  Sources also claim he’s trying to blackmail the company by his petition, which  is ruining its reputation and eroding shareholders’ value.

Volpi’s failed attempt to stop Oando’s 40th AGM, which successfully held in Uyo following the SEC approval, may have further proved his petitions lacked merit as stated by the company.

While the Tinubu-led management may have won the battle with the endorsement it received from shareholders, the war continues to rage as the two petitioners are not resting on their oars. In fact, following this media battle, Oando’ share price spiraled downwards leading to the much-needed and some may argue, late intervention by the House of Representatives Committee on Capital Market and Institutions summons of the Director General of SEC, Malam Mounir Gwarzo.

This begs the questions: Is SEC meant to be investigating Oando PLC when the grouse is clearly between Gabriel Volpi and his business partners?  Should SEC even be investigating a petition from an indirect shareholder?  What does this mean for well-meaning shareholders?


Notwithstanding the ongoing crisis, Oando has delivered on its promise to bring the company back to profitability by year end 2016. The Oando Group’s financial results for the year end 2016, turnover increased by 49 per cent, N569.0 billion compared to N382.0 billion in the corresponding period of 2015. Profit after tax increased by 107 per cent, N3.5 billion compared to a loss of N47.6 billion in 2015 and net debt reduced by 35 per cent N230.6 billion compared to N355.4 billion in 2015.

This is in spite of the fact that during that year, Oando Energy Resources (OER) recorded a 20 per cent decrease in total production to 15.9MM barrels of oil equivalent (boe) (average 43,503 boe/day) from 19.9MMboe (average 54,520 boe/day) in the comparative period of 2015.

Although, the results for the 2015 financial year were uninspiring, such would have been expected because of the situation in the global oil market, where oil prices took a plunge and the Nigerian economy, which had not found its footings. According to the 2015 financial results, the company recorded 10 per cent decrease in turnover, having posted N381.7 billion compared to N425.7 billion in 2014, and a marginal increase in gross profit, N77.7 billion compared to N72.3 billion in 2014.

The group’s upstream business, spearheaded by OER, saw a 118 per cent increase in total production to 19.9 million barrels of oil equivalent in 2015 compared to 9.1 million boe in 2014, and growth in average production from 24,945 boe/day in 2014 to 54,520 boe/day in 2015. That year, it also celebrated five years of continuous operations without a Lost Time Incident (LTI) on its “OES Teamwork” swamp drilling rig and 3 years of continuous operations without an LTI on its “OES Passion” swamp drilling rig.

In the midstream, Oando Gas & Power (OGP) commenced an 8.5km pipeline expansion for the Central Horizon Gas Company (CHGC), and signed a Sales and Purchase Agreement (SPA) to sell the Akute Independent Power Plant. While in the downstream, Oando signed an agreement for recapitalisation via the injection of $210 million from a Helios / Vitol JV; it increased its global footprint by incorporating a trading business in Dubai; and completed the construction of a 14.4 million-litre PMS tank in Apapa terminal.

Oando further recorded profit in its first quarter ended March 31, 2017 and half-year ended June 30, 2017 results, N1.7billion and N4.6 billion respectively.

Strategic Thinking

Realising that the crisis at home and global market had been taking tolls on its operations, the Oando Group executive management led by Mr. Wale Tinubu, examined its business model and introduced a five-step corporate strategy to restore the business to profitability. First, it began to de-leverage the business and optimise its balance sheet through debt restructuring, asset divestments and the injection of $350 million of capital.

By June 2016, it had successfully restructured its debt through a N94.6 billion Medium Term Note with lower capital costs  of about 15 per cent and a renewed five-year tenor, a feat many thought impossible due to banks’ reluctance in lending to oil and gas companies. When the first quarter results were published, Tinubu insisted that the target to return the business to profitability by the end of 2016 was still achievable.

As part of its strategy to ensure financial efficiency, Oando took a number of prudent steps in Q1 2016, one of which included delisting Oando Energy Resources from the Toronto Stock Exchange (TSX). The reason was simple: it had not realised any aggregate returns or fresh capital from the cost of listing the business and running its operations in Canada. As a result, it succeeded in improving its general and administrative costs from $3.70/boe in Q1 2015 to $3.19/boe in Q1 2016.

Also, in that quarter, Oando Gas & Power successfully divested from the Akute Independent Power Plant, a 12.15MW power station servicing the Lagos State Water Corporation.

The end of the year saw the completion of two key corporate actions that would change the structure of Oando’s business.  The first was the $210million recapitalisation for a 60 per cent share of its downstream operations to Helios Investment Partners a premier Africa-focused private investment firm and the Vitol Group, the world’s largest independent trader of energy commodities.  As a result, a new company was formed – OVH Energy.  The second was the partial divestment of its midstream business subsidiary, Oando Gas & Power Limited to Helios Investment Partners.

In Q1, 2017 Oando concluded the sale of Alausa Power Plant for a transaction price of N4.6 billion. Alausa Power Plant is a Public-Private Partnership project (Oando Plc and the Lagos State Government) developed in response to the need for stable and cost effective electric power supply to the Lagos State Government Secretariat in Alausa, Ikeja and its affiliate surrounding agencies. Commissioned in 2013, it is a 10.6MW capacity plant.

Both Akute and Alausa IPPs sales, analysts reason, are a testament of Oando’s legacy of building successful pipeline businesses, generating returns and transferring on operatorship.


Oando’s impact on the economy cannot be over-emphasised. Apart from being a household name in the Nigeria’s oil and gas industry, it has become a force in the matters of development in the country. The company is influencing the way Nigerians live as it  has been reported that one in five cars – around 2.3 million cars daily – on Nigerian roads drives on Oando’s fuel.

Oando Group pioneered the development of gas infrastructure to power industry.  Through its natural gas distribution network, it has been enhancing the global competitiveness of local industries by supplying gas to key clusters and infrastructure across Nigeria.

Apart from successfully building the largest gas pipeline network in Nigeria – 264km across Nigeria, Oando  also pioneered the development of West Africa’s midstream jetty, saving the country $120million in demurrage annually. The facility, which has a half-kilometre subsea pipeline, and a 16” 3km onshore line, will provide a more efficient platform for product receipt to all marketers currently using the MOMAN jetty. It is capable of delivering over 3 million tonnes a year.

More importantly, through its upstream business, it is harnessing the country’s natural resources to generate wealth for the nation.

On job creation, the group is positively impacting the lives of over 25,000 Nigerians. As a fully indigenous integrated energy company, its core staff base consists of a 98 per cent indigenous workforce. It directly and indirectly employs over 2,000 Nigerians.

As at June 2017, there were 168 companies listed on the Nigerian Stock Exchange with a market capitalisation of N19 trillion.  Of the 168 companies Oando is amongst the top 30 most capitalised with just over 12 billion shares outstanding. As at June 2017 Oando was 17.5 per cent (N115billion) of N654.65billion total oil & gas capitalisation on the Nigeria Stock Exchange.

In 2016, at the height of the recession when Foreign Direct Investment (FDI) into Nigeria had dropped by about 49 per cent over a period of 2 years, specifically oil and gas investments into Nigeria was at a record low, Oando brought in the largest foreign capital inflow, an FDI via its partnership with Vitol the world’s largest commodity trading company and Helios a premier Africa focused private investment company. Through its partnership with Helios and Vitol, it is positioned to become the largest downstream operator in Africa.

While it is on record that, Oando is the first African company to have a cross-border listing on the NSE and JSE, the two largest stock exchanges in Africa, it is also the first indigenous company to acquire an international oil company (IOC).

With regards to social enhancement, through its cleaner and affordable cooking options, Oando has, by its downstream operations, reduced greenhouse gas emissions by 50 per cent.

The group’s foundation supports the federal government in achieving its education development goals through its signature ‘Adopt A School’ initiative. In fact, through its foundation, Oando says it is educating Africa’s next generation of future leaders. To date the foundation has positively impacted over 200,000 Nigerians.