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Tag: Diezani Alison-Madueke

  • Diezani, NNPC set to answer Reps’ queries on kerosene

    Diezani, NNPC set to answer Reps’ queries on kerosene

    Not a few felt they were playing hide and seek. But , barring any last-minute hitch, Minister of Petroleum Mrs Diezani Alison-Madueke and managers of the agencies under her will today appear before an investigative public hearing on kerosene subsidy expenditures. The public hearing is sequel to resolution HR84/2013 of the House of Representatives, which directed its Committee on Petroleum (Downstream) to establish the actual amount spent on kerosene subsidy from 2010 to December 2013; establish the source of the money used in financing kerosene subsidy and the relevant budgetary approval; determine the companies benefiting from kerosene subsidy; establish the extent (if at all) to which the subsidised kerosene gets to the consumers at the regulated price; and investigate all incidental issues relating to kerosene supply and distribution.

    The Nation learnt yesterday that Mrs Alison-Madueke, Managing Director o the Nigerian National Petroleum Corporation (NNPC) and other agencies will appear before the House of Representatives Committee on Petroleum (Downstream) to answer questions on kerosene subsidy. Twice they had stayed away asking the committee for more time to gather necessary documents, among other excuses.

    “They are coming on Tuesday,” a competent source told The Nation. Their appearance is coming shortly after the issue they are coming to discuss cropped up at a hearing of the Senate Committee on Finance investigating the alleged missing funds from the Federation Account. It emerged that

    NNPC’s expenditures on Dual Purpose Kerosene subsidy totalling N543.9bn (about $3.151bn) were extra-budgetary.

    Alison-Madueke said there was a presidential directive that kerosene subsidy should be withdrawn but that the directive was not gazetted, adding that the inter-ministerial committee then comprising of the Minister of Finance and Minister of Petroleum Resources in 2009 directed a stay of execution of the kerosene subsidy withdrawal.

    The minister said should kerosene subsidy be withdrawn, the price of kerosene would triple and cause pains on the masses.

    She called for the legal interpretations of the NNPC Act in respect of the first line charge of the corporation to decide the legality of its status in respect of kerosene subsidy deductions.

    The committee frowned at the expenditures by the NNPC on kerosene subsidy payments, which it said was not appropriated for and called for immediate reversal of the extra- budgetary expenditures to promote accountability and transparency in public finance and restore public confidence in the system.

    Despite the subsidy payment, consumers benefitted less from the scheme known as Kero-Direct initiated by the NNPC in July 2011 to help distribute household kerosene (HHK) to consumers nationwide.

    Peterside, while speaking at a function organised by the Lagos Chamber of Commerce and Industry (LCCI), said the Federal Government spent N634 billion as subsidy on kerosene between 2010 and 2012, describing this as a network of corruption and fraud.

    He said Nigeria, world’s sixth biggest crude exporter, could not move forward with the present arrangement where the NNPC holds the monopoly of kerosene importation.

    Peterside said: “No country that spends most of its funds on consumption will grow. And so that explains why Nigeria is not moving forward. How can we move forward when most of our funds are spent servicing corruption?

    “Kerosene subsidy is a network of corruption; it is a network of fraud. So why are some people blaming the fraud on the monopoly of NNPC? Even when you ask major marketers they will tell you that the monopoly of NNPC is responsible for what we are going through today to access kerosene.

    “The first challenge is that the supply of kerosene is regulated. Everywhere in the world where there is monopoly, people are likely to suffer while monopolist tries to maximise the situation; this is because NNPC has the monopoly of importing kerosene.

    “In the year 2010, we spent N110,068,533,988 to subsidise kerosene; this is not the cost of kerosene but the cost of subsidising the product alone…In 2012, although we are yet to reconcile this, we spent N200 billion subsidising kerosene.”

    With the minister and her men’s expected appearance at the investigative hearing today, it is hoped the committee will be able to establish the actual amount spent on kerosene subsidy from 2010 to December 2013; establish the source of the money used in financing kerosene subsidy and the relevant budgetary approval; determine the companies benefiting from kerosene subsidy; establish the extent (if at all) to which the subsidised kerosene gets to the consumers at the regulated price; and investigate all incidental issues relating to kerosene supply and distribution.

     

  • Controversial ministers still holding on

    Controversial ministers still holding on

    Four ministers ‘left’ the Goodluck Jonathan administration yesterday. Not a few believe that some other members of the cabinet, for one reason or the other, should also excuse themselves or be excused from the cabinet, writes Deputy Political Editor Raymond Mordi and Assistant Editor Leke Salaudeen

    Diezani Alison-Madueke has been described as one of the two most powerful women in Nigeria. Courtesy of the generosity of President Goodluck Jonathan, she has held three significant positions in government from July 2007. She has also faced one controversy after another. In September 2008 there was an unsuccessful attempt to kidnap Mrs Alison-Madueke at her house in Abuja. On 23 December 2008, she was named as Minister of Mines and Steel Development. In October 2009, the Senate indicted her and recommended her for prosecution for the alleged transfer of N1.2 billion into the private account of a toll company without due process and in breach of concession agreement. However, the allegations have not been proved, and the minister has maintained her innocence.

    After Jonathan became acting President in February 2010, he dissolved the cabinet on March 17, 2010, and swore in a new cabinet on April 6, 2010 with Mrs Alison-Madueke as Minister for Petroleum resources. One of the most controversial policies introduced under Mrs Allison-Madueke as minister of petroleum resources is the government’s plan to remove subsidies on petrol. She vehemently supported the discontinuation of the subsidy on the grounds that it “poses a huge financial burden on the government, disproportionately benefits the wealthy, and encourages inefficiency, corruption and diversion of scarce public resources away from investment in critical infrastructure”.

    Following the cabinet reshuffle in September last year that saw the removal of nine ministers, there was outrage over Jonathan’s decision to keep Mrs Allison-Madueke. Critics then said the President Jonathan should have fired “deadwoods” and controversial ministers, such as Mrs Allison-Madueke. They specifically expressed outrage that Alison-Madueke, Ngozi Okonjo-Iwela, Finance Minister and Coordinating Minister of the Economy; Attorney General and Minister of Justice, Mohammed Adoke; and others were left untouched. Last year’s cabinet shake-up came after months of speculation.

    In May last year, the House of Representatives mandated an ad hoc committee to investigate the petroleum minister over an alleged shady N9 trillion oil deal. The House was told that in perpetrating the deal, there was a deliberate exclusion of indigenous operators from exercising their rights of first refusal in transactions that led to the carving out of oil blocks. This Monday, her absence stalled the probe of the controversial kerosene subsidy by the House of Representatives. The House, through a resolution, mandated the committee to investigate issues surrounding kerosene supply, distribution and subsidy payments from the year 2010 to 2013. Apart from Mrs. Allison-Madueke, other agencies under her supervision and directly related to the subsidy claims were also absent. Agencies absent include the Nigeria National Petroleum Corporation, (NNPC) and the Pipeline, Products Marketing Company (PPMC).

    Ngozi Okonjo-Iweala

    She is the Minister of Finance and Co-ordinating Minister of Economy. Mrs Okonjo-Iweala, a renowned economist from the World Bank, served in a similar capacity during the Olusegun Obasanjo administration. Her tenure under Goodluck Jonathan has become controversial because of the poor performance of the nation’s economy. She was summoned early this year by the House of Representatives to explain the state of the economy. She was handed 50 questions on which the House demanded written comprehensive answers. Though, she had responded but the House said it was not satisfied with the answers.

    The House frowned at the 2014 budget presented by the Minister. The House observed that the pattern of presenting the budget breached the Fiscal Act of 2007 which requires the Minister of Finance to cause and attach the estimates of the Corporations to the national budget presented to the National Assembly.

    One aspect of the budget that has been severely criticised is the allocation of over 70 per cent to recurrent expenditure leaving less than 25 per cent for capital projects. Her explanation that the failure of the Federal Government to implement the Oronsaye report on restructuring of Government Ministries, Departments and Agencies that could lead to a reduction in overhead cost was responsible, the excuse was not acceptable to Nigerians.

    The revelations by Central Bank that the Nigerian National Petroleum Corporation (NNPC) did not remit some earnings from crude oil sales are disturbing. First, it was $10.9 billion that NNPC failed to account for. Now the Corporation is ‘found wanting’ over $20 billion Kerosene subsidy. The poor management of the nation’s foreign earnings does not speak well of those in-charge of the nation’s economy. The worst is that Nigerians don’t know how much we are earning from oil sector , the mainstay of our economy.

    The expectation was that with the likes of Mrs Okonjo-Iweala on board, prudent management of the economy would not be a problem.

    Nyesom Wike

    He was appointed Minister of State for Education by President Goodluck Jonathan in 2011. Prior to his ministerial appointment, he was the Chief of Staff to Governor Rotimi Amaechi of Rivers State. The governor trusted him a lot and delegated powers to him, an act that made people of Rivers to think that the governor was weak.

    On getting to Abuja, Wike turned his back against Amaechi and became a ready tool in the hands of the Presidency and the First Lady to destabilise the government of Rivers State. He was fingered as the brain behind the events that led to the suspension of Amaechi as a member of the Peoples Democratic Party (PDP), the crisis that erupted over the dissolution of Obi-Akpor Local Government, the bloody clash at the State House of Assembly that left many members injured, the failed attempt by five law makers to impeach the governor and the manipulation of the State Police Command against Governor Amaechi and his supporters. He has declared governorship ambition for 2015. He has started campaigning ahead of 2015 elections through a political group called Grassroots Democratic Initiative.

    As a minister, he was supposed to be at his duty post in Abuja every day but Wike spends most of his time in Rivers State. Observers are of the opinion that his absence from office is affecting the smooth running of the Ministry of Education. They recalled that the Academic Staff Union of Universities (ASUU) lasted almost six months because the supervising Minister in the Ministry of Education failed to do what was expected of him to avert the crisis and resolve the issues involved promptly. Two months after the Federal Government signed an agreement with ASUU, government has failed to release funds as promised. The Academic Staff union of Polytechnics (ASUP) has been on strike since last year. There is no serious approach on the part of government towards ending the crisis.

    The crisis in the education sector speaks volume of leadership failure which must be addressed to save the critical sector from imminent collapse.

    Chinedu Nebo

    Days after his formal inauguration, Prof Chinedu Nebo took the first bold step towards fulfilling his primary assignment of reviving the ailing power sector reform programme by launching the ‘Power Sector Roadmap Reform’. The initiative, the new minister said, was designed to review the original road map developed in 2010 and produce data which are more consistent with the current and future challenges.

    Nebo, who asserted that the target of uninterrupted power supply and the 40,000 megawatts by 2020 for the country was achievable, vowed to fight the forces bedeviling the sector and collaborate with stakeholders to actualise the dream of efficient and stable power supply. He blamed the neglect and lack of infrastructural investment on the near collapse of the power sector, saying the reforms by the present administration requires holistic efforts and sustainable investment to succeed. “The power sector development is ongoing but will take time, money and more importantly the support of all Nigerians to see to the conclusion of the sector reform,” he said.

    But his power sector reform may not have enjoyed a smooth sail. The privatisation of the defunct Power Holding Company of Nigeria was fraught with some challenges. This indication emerged late last February, following the failure of the government to trash out outstanding legal, labour and financial issues bedeviling the ongoing privatization process. Though the Vice President Namadi Sambo-led National Council on Privatisation (NPC) has reportedly railroaded the preferred bidders of the 15 of 17 Power Holding Company of Nigeria (PHCN) successor companies into signing of the Sale and Purchase Agreements (SPAs) and completing their payment and formal hand over of the firm to the successor companies, there are fresh signs that the imbroglio over severance pay package is yet to be fully resolved. Claims by the Labour and Productivity Minister, Mr Emeka Wogu on February 20 that all labour issues relating to the privatisation of PHCN assets had been resolved with government kick-starting payment of the PHCN workers’ severance package were later refuted by the three unions in the power ministry. The electricity workers under the aegis of the National Union of Electricity Employees (NUEE) said in a statement released by its Secretary-General, Joe Ajaero that it rejected the government’s offer of N384 billion exit package on the ground that faulty data was used for its computation.

    The privatisation programme, which remains pivotal to President Jonathan’s Power Sector Roadmap, has suffered repeated timeline failures due to unresolved industrial disputes, legal and financial quagmires. According to some industry observers, without finding a way to neutralise various vested interest groups scheming for relevance in the sector, Prof. Nebo may fall into the landmines that forced his predecessor to resign.

  • Missing $10b oil cash: Fashola urges minister, others to speak up

    Missing $10b oil cash: Fashola urges minister, others to speak up

    Lagos State Governor, Mr. Babatunde Fashola (SAN) has called on the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, the management of stste-run oil firm, the Nigerian National Petroleum Corporation (NNPC) and those connected with the missing $10 billion oil money to speak out in the interest of the nation.

    Fashola, who spoke at the Lagos House, Ikeja yesterday said continued silence of the stakeholders on the issue constituted an injustice against the ordinary Nigerians who have had to contribute from their meagre earnings to fund projects and programmes that are constitutionally the responsibility of government.

    The governor identified the provision of security as an item which naturally falls within the ambit of the responsibility of government but which individuals and private organisations are now contributing to provide in order to secure themselves and their environment while the Federal Government could not account the nation’s commonwealth. He said the missing money could go a long way to fund the Police and strengthen security in the country.

    Thanking organisations and individuals who have been contributing to the State’s Security Trust Fund, Governor Fashola said: “The tragedy of our nation is that while we are debating whether we have accounted for $20 billion or $10 billion, ordinary citizens are contributing money to fund the responsibility of government.

    “It hurts me but this is where we are because you can only wonder and imagine what $10 billion can do for the Police; what $10 billion can do in terms of vehicles, in terms of the kind of truck donated, in terms of equipment. But I hope that things get better.”

    The governor urged those concerned in the missing money saga to speak out, adding that the matter could only be resolved when it is brought out to public domain.

    “I have said the issue of accounting for that money must be resolved publicly in the interest of Nigerians. It is a debate that all of us must participate.

    “Peacefully, we will resolve it, whether it is $10 billion or $20 billion. We must know where that money ended up and everybody that has a duty, including the Minister herself, must speak up now,” he said.

  • We’ll ensure kerosene subsidy is accounted for, says Peterside

    We’ll ensure kerosene subsidy is accounted for, says Peterside

    The Chairman, House of Representatives Committee on Petroleum (Downstream), Dakuku Peterside, has said the committee will make sure that kerosene subsidy payments are accounted for.

    He spoke yesterday while announcing the postponement of the committee’s proposed investigation into the kerosene subsidy.

    Peterside said the postponement was due to the absence of the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mr. Andrew Yakubu and the Pipeline and Products Marketing Company (PPMC).

    The hearing will now hold on February 18.

    This is the second time the investigation has been pushed forward.

    The Committee had in its letters to the three principal actors in the sector requested for the provision of “all relevant detailed information as it relates to approvals on kerosene subsidy, source of money for payment of the subsidy, budgetary approvals, kerosene import details, PFI allocation and product distribution chart, PPPRA authorisation and validations, auditors approval and reports, relevant shipping documents and all other documents that will assist the committee in discharging its responsibility.”

    A letter from the Office of the Permanent Secretary, Ministry of Petroleum Resources, dated February 7 but received in Peterside’s office a few minutes before the commencement of the probe yesterday gave excuses for the absence of the Minister and requested for a rescheduling of the hearing.

    It reads: “I wish to inform you that the Honourable Minister together with the top management if the Ministry and its agencies will be participating in the International Summit on Power Financing starting today, 10th February, 2014.

    “As a result we regret to inform you of our inability to honour your invitation. We are also currently engaged with the Senate Committee on Finance and it is not clear when their hearing will end. “

    NNPC, in a letter by its General Manager, National Assembly Liaison, Mr. M.B Bamanga and dated February 7, gave the same excuse as the ministry. “I am further directed to appeal to the Chairman to allow NNPC and its subsidiary sufficient time to collate the required documents and reschedule an alternate date for the appearance of our organization at the hearing, please,” the NNPC said.

    The PPMC’s letter, also dated February 7, also followed the same format with the same excuse and request for additional time to collate documents.

    Peterside said: “It is not in the character of the seventh National Assembly to waste people’s time. On behalf of the committee, I want to apologise to you; we are going to be compelled by circumstances to put off this hearing to the February 18.

    “We owe you a duty to carry out the investigation, we will not let you down, we want to apologise once more, we will move on with the hearing February 18th.”

     

  • Jonathan and the sisters of good luck

    Beyond the flood of interpretations that greeted the eventual fall of former Peoples Democratic Party (PDP) chairman, Bamanga Tukur, there is a possibly overlooked dimension to his forced resignation after a long-drawn-out battle with antagonistic forces within the party. It is instructive that President Goodluck Jonathan apparently finally sacrificed Tukur when it came to choosing between protecting him and retaining control of the party to reinforce a possible desire for re-election in 2015.

    Jonathan, ironically, identified the man Tukur as an obstacle, despite his unapologetic support of the presidential agenda; perhaps helping to put in clearer perspective just how dispensable the president regards masculine figures, especially those in the power loop.

    With women, however, the picture of the president is that of an accommodating gentleman; or a man who appears to be gentle. It is generally believed that Jonathan would probably do anything to satisfy his beloved wife, First Lady Dame Patience, particularly considering his demonstration of enmity towards the perceived enemies of his better half, represented in recent times by the embattled Rivers State Governor Rotimi Amaechi.

    Speaking of Jonathan’s tender treatment of females, three other prominent feminine figures, in particular, come to mind; specifically, Minister of Finance and Coordinating Minister for the Economy, Ngozi Okonjo-Iweala, Minister of Petroleum Resources, Diezani Alison-Madueke, and Minister of Aviation, Stella Oduah. Perhaps never in the country’s political history have women been the custodians of so much power, and controversially too.

    While Okonjo-Iweala continues to attract loud criticism for alleged ineffectiveness, Alison-Madueke for alleged imperiousness and Oduah for alleged impropriety, Jonathan has interestingly carried on as if nothing is amiss. Notably, they have something in common: strident calls for their removal. Oduah’s case is especially reflective of Jonathan’s soft spot for the opposite sex, with the presidency treating her with kid’s gloves, in spite of weighty charges of misconduct relating to the scandalous purchase of two armoured cars for N255 million.

    Indeed, it is food for thought that Jonathan apparently does not consider the public outcry against these women, or outrage in the Oduah matter, sufficiently threatening to his administration, which contrasts with the treatment that Tukur received at his hands. This double standard approach, not to call it mentality, does not speak well of Jonathan’s sense of fairness, does it?

    While it may not be so obvious what charms the women possess that make it tough for Jonathan to treat them as expendable objects, there can be no doubt that there is more to their survival than meets the eye. Unlike the Tukur affair, Jonathan evidently does not feel any embarrassment in the company of the trio. The phrase “sacred cow” seems to find clear expression here.

    Jonathan’s gender politics, for that is what it looks like, has the appeal of ugliness; and it is possible to speculate about feelings in the corridors of power, where the circle must know that the overall boss would rather keep the strong women than the weak men, which may not necessarily be a matter of perception. These three sisters of good luck must be the envy of many.

  • Lost and found!

    Lost and found!

    If Nigerians ever needed iron-clad evidence of outlawry of their national oil corporation, weekend’s response by the General Manager, Media Relations, Group Public Affairs Department, NNPC, Omar Farouk to the firestorm over the alleged missing $10.8billion may have finally supplied one.

    Not that anyone ever doubted the farce that rules the nation’s finance system as a whole; or the plague of officials helping themselves to the national till that has long become norm. However, the latest revelation of the laissez faire conduct, the outrageously out-of-control practices by a corporation that is supposed to be a creation of statute –with active connivance of top officials of the finance ministry – may have set new limits in outlawry.

    Let’s start from the very beginning.

    Late last year, Governor, Central Bank of Nigeria, Lamido Sanusi, had alleged that the corporation failed to remit $49.8bn to the Federation Account for the period spanning 18 months – that is, between January 2012 and July 2013. The problem, as it later turned out was that the figures declared missing had failed to take into account the $39 billion paid by the Federal Inland Revenue Service, FIRS, and the Department of Petroleum Resources, DPR, into the federation account.

    I had said on this page that, coming from the nation’s top banker, the ‘omission’ was inexcusable, if not entirely irresponsible. Since then, the officials of the finance and petroleum ministries – including the NNPC, have made valiant attempts to pass off the charge as fiction even when there was still $10.8 billion unaccounted for.

    Apparently, the corporation’s weekend tale of the missing money was meant to be the final demolition job on the charge by the CBN governor. While I do understand that some so-called defence do not so qualify; the suggestion that the missing money has been spent on behalf of the federal government, is not only worse than no defence at all, it borders on the treasonable!

    Let’s look at the three-part component of how the money went as told by the NNPC’s spokesman.

    The first part, he claims represents “the expenses on some of the responsibilities, which the corporation carries out on behalf of the Federal Government with respect to domestic crude oil utilisation. One of such issues is the unpaid subsidies on kerosene and Premium Motor Spirit”.

    Here, if Nigerians are any familiar with the billions allegedly paid to the scores of ghost importers of petrol and kerosene, the tale about the value being deducted at the source from NNPC’s piggy bank on behalf of the federal government has been told so severally to the point of being wearisome. Considering that the same subsidy is also said to be charged on the excess crude account, Nigerians must wonder at what is going on.

    The same applies to the 32 days’ stock of premium motor spirit at 40 million litres of national consumption per day. Isn’t that supposed to be one-off budget? Of course, while the reserve accounting looks easy and simple and straightforward to determine upfront, NNPC and its allies in government obviously think that they require something outside the cycle of the budget to defray.

    And the third – you guessed right: the cost “of pipeline vandalism, oil theft and other security issues”.

    Again, that is supposed to be indeterminate – the kind that requires the rule of thumb to determine.

    And the three, we are told is what makes up the yet-to-be-reconciled balance of $10.8bn”!

    Should anyone be surprised at the creative account that seeks to work backwards to the answer? To be candid, the shock would have been if the reconciliation team came up with anything new?

    To begin with, for a corporation that has long acquired the image of a lawless entity, the self-indicting revelation that the quantum of national obligations – reckoned in billions of dollars – could be financed outside of the framework of appropriations can only pass on the altar of the ingrained culture of criminal impunity. Before now, the arguments about the deductibles from the federation account had always centred on the shady operational costs borne by the NNPC in the course of its activities. Quite familiar also is the creative accounting in which all manners of expenses gets passed off to the federation account.

    Now, the revelation that the corporation has a licence to do as it pleased with the federation account has finally been declared as legit!

    So, no money is missing? Only when one accepts that the beneficiaries of the accruals into the federation account actually get the amount due to them can one suggest otherwise.

    Now to the specifics: Did Finance Minister Okonjo-Iweala actually claim last year that she had not paid any subsidy on kerosene since she assumed office? At what point was it therefore charged to the NNPC account? Is a case of looking for expenses to charge to the missing money?

    The latter obviously raises the question of who authorised the payment from the NNPC accounts. Petroleum Minister Diezani Alison-Madueke? Or the NNPC board which she chairs? Does the board – if it exists – have such powers? Is it the Federal Executive Council? Could they have done so without the authority of the National Assembly?

    While Nigerians may not have bothered about the laws of the republic being broken by officials sworn to uphold the law, I guess it’s time to worry about the parallel government described as the NNPC; a quasi-government without the strictures of parliament; an entity only answerable to a conclave.

    Still want to know where the money went? Certainly, it’s not in the books. Try as the reconciliation team might, the job goes beyond reconciliation. That itself assumes that the reconcilers have the nerves to do the job. Soon enough, Nigerians would see evidence in the cities and the country-sides when our Abuja overlords unleash their war-chest for 2015. That time, it would be headache for Sanusi as it would be for everyone of us all.

    Again, it is happy New Year!

     

  • Yoked to the past

    Yoked to the past

    Two weeks after the announcement by Petroleum Minister, Diezani Alison-Madueke of the plan by government to sell the nation’s four refineries by the first quarter of 2014, there are enough signs already to suggest that the process is not guaranteed a smooth sail. As it appears, not even the horror of the reversal of an earlier sale of two refineries to Bluestar Consortium by the late President Umaru Yar’Adua, or the self-evident folly that flowed from that botched exercise would suffice to persuade those whose understanding of the times seems at best antediluvian to have a change of heart.

    I refer of course to the latest round of opposition mounted to the planned privatisation of the refineries by the Trade Union Congress (TUC) and the newly created multi-purpose vehicle– NUPENGASSAN – an amalgam of the National Union of Petroleum and Natural Gas Workers, NUPENG, and the Petroleum and Natural Gas Senior Staff Association of Nigeria PENGASSAN.

    The indications are that a titanic battle lies ahead.

    Not surprisingly, it would be another instance in which emotions rather than reasons would rule the roost; the same old stuff about a patrimony that needs to be preserved for some future generation. And so the argument goes that simply because those refineries were built with millions of dollars of taxpayers’ money, everything must be done to preserve them as public entities even when it amounts to pouring scarce funds into bottomless hole.

    Here is how the TUC chieftain put it: “Other countries are building and maintaining refineries, what are you selling them to achieve? Is it to privatise them? What becomes of the workers and the assets? What becomes of the people whose land produces the oil? Are you going to sell to them as if Nigeria is not producing oil? Which of the OPEC countries will sell their refineries now? It is a development that workers will not accept just like that”.

    NUPENGASSAN on its part could not make its point without the usual threat to shut down the economy: “This planned outright sale is uncalled for; inimical to the economy and Nigeria as a nation…If government refuses to listen to the voice of reason, we will have no option than to do the needful – shut down the sector to protect these asets for generations unborn”.

    The problem with NUPENGASSAN and their likes is that they have simply refused to change. If their penchant to revert to their traditional default setting of antagonism is partly understandable given the history of their tortuous relationship with the government, their insistence on yoking the nation to the past, far from accceptable, is certainly not tenable in 2013. The point is, if only they would just take a step out of their comfort zones, they would find that the idea of elevating proprietorial issues over and above service delivery is long dated. Imagine defending such patently obsolete paradigm which puts everything other thing over above service?

    So, what’s their understanding of privatisation– stripping those aged complexes – bolts and nuts – and transferring them from their present locations to some fantasyland? Isn’t it about transferring them to better, more capable hands to enable their deliver on their rationale? What could be wrong with that? Isn’t somebody getting things muddled up here? Again, so much for the paranoia, what makes privatisation of the power sector desirable and the refinery not? And where is the evidence that some future administration would do better with the management of the refineries even when the facts of government’s legendary incompetence sticks out? And why should the interest of the unions override the collective interest of Nigerians?

    Imagine the costs being borne by the nation since TUC and their NUPENGASSAN fellow-travellers in the oppose-the-sale-train forced the hand of the federal government to abort what was possibly the best deal in the circumstance. It started with the $700 cheque returned to the Bluestar Consortium – a decision which although was quite popular then, was probably the dumbest, stupidest thing to do by a supposedly rational administration. Since then, the opportunity costs have grown to humonguos proportions. How many millions of dollars have been poured into the endless Turn Around Maintenance ever since? I wager that it would have exceeded that $700 million paid for the two refineries.

    Six years on, can anyone guarantee that the so-called prized assets would be worth anything near that $700 million?

    And now, courtesy of the presidential audit team on the refineries, we are even now learning that their performances are “sub optimal”, fit for the auction market! Yes, we have managed to poured billions of naira into the refineries for far less value all for the love of Grandpa’s piece of Oldsmobile! How about that as a fitting wage for prodigality?

    Now, if you ask me, it would hardly matter if the refineries are off-loaded into the market today. And I wouldn’t even bat an eyelid if the refineries are sold for a nominal price of one naira! Why should it matter that one money-bag with more cash than business buys up the carcass so long as he/she able to put it work? Who cares whether the fuel dispensed at the pump comes from Wazobia refinery so long as quality is guaranteed? Or would rather TUC and company prefer that the country continue to throw money into the hopeless entities? Is that what they want?

    Don’t ask me whether anything could be wrong with government establishing new refineries. First, it is late in the day. Secondly, its no use attempting to force an unwilling horse to drink. Moreover, the prospects of another refinery owned by the government must be seen as frightening indeed at this time. Apart from the fact that value for money at any point along the procurement chain would be a distant dream, it would most certainly end up as a museum piece – like the infamous four now locked in the battle to find willing suitors.

    We can only plead that TUC and NUPENGASAN take heart. One of the great lessons of the wave of globalisation is the futility of fighting it. As the far as the issue of the refineries’ privatisation goes, it’s as good as saying that the battle is lost; time to concentrate on the minor battle of process.

  • Unanswered questions

    Unanswered questions

    •Oil minister’s news of sale of four refineries reflects a disingenuous government

    It is difficult to understand exactly what the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, wants Nigerians to make of her recent disclosure that the country will commence the privatisation of its four state-owned ailing refineries in the first quarter of next year. Speaking in an interview with Bloomberg TV Africa in London, the minister said, “We would like to see major infrastructural entities such as refineries moving out of government hands into the private sector … Government does not want to be in the business of running major infrastructure entities and we haven’t done a very good job at it over all these years”.

    Now, does Mrs. Alison-Madueke expect Nigerians to pat her on the back and applaud her ministry on this score? If so, she utterly underestimates the disenchantment and disgust of the public at the abysmal level of corruption and sheer criminality that have crippled the oil sector, particularly under her watch. She seems to be oblivious of the fact that, even though this could be a step in the right direction, the privatisation of the refineries is only a minute part of the serious challenge of thoroughly overhauling the oil industry and transforming it into an effective vehicle for achieving national developmental objectives.

    Given the near total dependence of the economy on crude oil exports, the level of laxity and lack of cohesion that characterise the management of Nigeria’s petroleum sector is unbelievable. Despite the eloquent lip service paid to the development of the non-oil sector, government seems pathetically incapable of weaning the country off oil addiction. That Nigeria relies on fuel imports to meet over 70 percent of her domestic needs, even though she is a leading producer of crude oil, illustrates the inexcusable absence of seriousness in the management of such a critical economic sector.

    The announcement by Mrs. Alison-Madueke of the impending privatisation of the refineries raises a number of fundamental and pertinent questions. For instance, why should anyone be enthusiastic about this initiative since this is a path the country had charted before without success? In the twilight of its tenure, the President Olusegun Obasanjo administration actually sold off the refineries to the private sector. However, that transaction was terminated by the Umaru Yar’Adua administration for alleged abuse of due process. What guarantee do Nigerians have that the privatisation process this time around will be above board, since the management of the petroleum sector remains as graft-ridden and lacking in transparency as ever?

    The paralysis of the country from the oil subsidy strikes was reversed on the promise that the proceeds will be used to restore the refineries while work would start on Greenfield Private Refineries. The Federal Government has fulfilled these only in the breach.

    If not, why did the petroleum minister confidently assure the nation last year that the Turn Around Maintenance (TAM) being undertaken in the four refineries, coupled with the proposed three Greenfield Private refineries planned for Lagos, Kogi and Bayelsa states would substantially boost domestic refining capacity and end fuel imports by the end of this year? If the plan all along had been to privatise the refineries since they cannot be effectively run by government, why waste scarce resources on a barren TAM? The impression is that the Jonathan administration conned the nation.

    Even more seriously, the probe of the fuel subsidy management scheme last year revealed collusion by public and private sector operators in the oil industry to capitalise on fuel imports to engage in monumental graft through phantom subsidy payments. The implication is that these criminal elements benefitted over the years from the dysfunctional state of the country’s refineries. Can these same tainted officials be trusted to oversee the much desired transformation of the oil industry?

    In particular, does Mrs Alison-Madueke under whose watch much of the mind-boggling corruption occurred have the moral authority to supervise the sanitisation of the sector, including the privatisation of refineries?

  • Alison-Madueke, Nebo, others for PIB confab Thursday

    The Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, Minister of Power, Prof. Chinedu Nebo, lawmakers, top officials and regulators in the oil and gas industry will converge on Lagos on Thursday to chart course for the passage of the Petroleum Industry Bill (PIB) and other issues.

    The event, which is the yearly August conference of the National Association of Energy Correspondents (NAEC), has as theme: “PIB: Harmonisation and implementation for economy growth,” will hold on Thursday, August 22 at Eko Hotel and Suites, Victoria Island, Lagos by 9am.

    In a in a statement, the Secretary of the association, Yunus Yusuf, said Alison-Madueke will be the special guest of honour while the Group Managing Director, Nigerian National Petroleum Corporation (NNPC) will deliver the keynote address.

    The Minster of Power, Prof. Chinedu Nebo will speak on “Driving capacity growth in liberalised power sector,” while the PIB Team lead, Ministry of Petroleum, Abiye Membere, will deliver the lead paper.

    The Director, Department of Petroleum Resources (DPR), George Osahon, will speak on “Expectations and challenges of effective regulation in deregulated regime,” and the Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB), Engr. Ernest Nwapa, will talk on “Three years of NCDMB: Achievements and challenges.”

  • Jonathan visits Fashola over father’s death

    Jonathan visits Fashola over father’s death

    President Goodluck Jonathan on Wednesday visited Lagos State Governor, Babatunde Fashola, at his Marina residence to condole with him over the death of his father.

    The News Agency of Nigeria reports that the president was accompanied by key members of his cabinet, among whom were the Minister of Petroleum, Mrs. Diezani Allison-Madueke and the Attorney-General of the Federation, Mr. Mohammed Adoke.

    The Minister of Information, Mr. Labaran Maku; Minister of Sports, Mallam Bolaji Abdullahi; Special Adviser to the President on Inter-party Affairs, Sen. Ben Obi; as well as the Chief Imam of Abuja, Alh. Musa Mohammed, were also on the entourage.

    The governor and his wife, Abimbola, his sisters – Mrs. Arinola Fuwa and Miss Olayinka Fashola — their children and some members of the state executive council, were on hand to receive the President and his entourage.

    In his remark, Jonathan described the death of Fashola`s father as saddening ,noting that the late patriarch left at a time when he was most needed to offer counsel that would assist to further develop the nation.

    He, however, said the deceased lived a fulfilled life, and left enduring legacies behind.

    “When we hear about the death of the father of the governor, I was very sad because we know this is a period that we need our parents most, especially parents that would assist us in handling a number of responsibilities.

    “Mr. Governor, it is a sad thing for you to have lost your father at this time, but one must also thank God for the life he has lived. For those of us who are Christians, the Bible tells us we are supposed to live three scores plus ten,” he said.