The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, said on Wednesday Nigeria has lost $21 billion on oil Production Sharing Contact (PSC) in the last 20 years.
The minister said previous governments failed to exploit opportunity of the Deep Offshore Act that made provision for premium element to be shared once the price of crude exceeds $20 per barrel.
He said that the Federal Executive Council (FEC) meeting on Wednesday approved steps to amend section 15 of the PSC of the Deep Offshore Act.
Kachikwu briefed State House correspondents at the end of FEC meeting chaired by Vice President Yemi Osinbajo at the Presidential Villa, Abuja.
The Minister of Transportation, Rotimi Amaechi, Minister of Niger Delta Affairs, Usani Uguru Usani and the Senior Special Assistant on Media and Publicity to the President, Garba Shehu, also attended the briefing.
Kachikwu said: “The first and most substantial thing for me is the decision to work with the Attorney General of the Federation to amend section 15 of the Production Sharing Contract (PSC) of the deep offshore act.
“Under the deep offshore act, there was a provision in 1993 that once the price of crude exceeds $20 a barrel, the government will take steps to ensure that that premium element is then distributed at an agreed premium level for the federal government so that we get more for our oil.
“But over the last 20 years, nothing really was done. From 1993 to now, cumulatively, we have lost a total of $21 billion just because government did not act. We did not exercise it.
“In 2013 there was a notice to oil companies that we were going to do this but we didn’t follow through in terms of going to Council to get approval
“One of the things we’ve worked on very hard over the last one year is to get that amendment because once we do, the net effect for us is close to $2 billion extra revenue for the federation.”
The minister also said there is no plan by the government to increase pump price of fuel in the country.
Minister of State for Petroleum Resources, Dr Ibe Kachikwu, says the major cause of the fuel scarcity currently being witnessed across the country is shortfall in supply of petroleum products.
Kachikwu, who stated this in a news briefing on Thursday in Abuja, however, said that the Nigerian National Petroleum Corporation ( NNPC ) was making efforts to ensure that queues at filling stations disappeared in a couple of days.
“Presently, queues in Lagos have reduced. We know that Lagos, Abuja, Benue, Port Harcourt were among the worst-hit areas.
“Benue has been dealt with; Port Harcourt is quite moderated. Apart from these areas, other places in the country are probably liquid.
“The major problem is the gap in terms of volume, because NNPC is the only one importing the product to the country,” he said.
The minister assured that there was adequate storage facility for imported products, adding that emergency measures were in place to ensure that the products were available during the Yuletide and post-January.
He said that four vessels laden with petroleum products would “berth in a few days and a total of 20 cargoes are also expected with petroleum products’’.
Kachikwu said that the NNPC had, as at Wednesday, discharged products at its depots, adding that emergency supply, quick truck delivery and stricter monitoring were measures adopted to ensure that queues disappeared.
He added that NNPC would use additional trucking to major cities using strategic reserves from Suleja, Minna, Gusau and Gombe.
This, he said, would help to service Abuja, Kano and Sokoto axis to feed the North-West, North-East.
“I have asked the Department of Petroleum Resources (DPR) and Petroleum Products Pricing Regulatory Agency to ensure stricter sanctions on any station that refuses to abide by the rules.
“They need to take a firm action to ensure that we get quick results,’’ he said.
Kachikwu further assured that the market would be flooded with more products to cushion effects of over-subscription through Kaduna refinery production, adding that Port Harcourt was expected to start producing 2.1 million litres of petrol per day.
He said that it was expected that with the adopted strategies, the queues would “slide down’’ in one week.
On long-term strategy, he said that ultimate result would come when the refineries resumed optimal production.
The minister said that work would commence effectively in the refineries in January.
Executive Secretary of DPR, Mr Modecai Ladan, said that many sanctions awaited filling stations found compromising the dispensing process, warning that the stations would be shut down or charged N275 per litre.
He said that any station found hoarding products would either be sealed or its product auctioned or dispensed free-of-charge to consumers.
Ladan added that depending on the offence, defaulters may be shut down for six months or blacklisted.
The News Agency of Nigeria (NAN) reports that a drive round Abuja metropolis and highways revealed that only a few filling stations were opened for operation, serving long queues.
The Federal Executive Council (FEC) on Wednesday ordered the Nigerian National Petroleum Corporation (NNPC) and the Petroleum Ministry to ensure the current fuel scarcity in some parts of the country do not last beyond weekend.
The Minister of Information and Culture, Lai Mohammed, disclosed this to State House correspondents at the end of FEC meeting in Abuja.
Stressing that the Minister of State for Petroleum Resources, Ibe Kachikwu, could not attend the post- FEC briefing because of an urgent appointment, he said the minister gave FEC assurance that there was no cause for alarm.
According to him, Kachikwu told FEC that there is enough fuel in the country to last till January 2018.
He said there is no intention by the government to increase the pump price of fuel.
The Minister of State for Petroleum Resources, Dr Emmanuel Ibe Kachikwu on Wednesday said that the ministry is developing a comprehensive and holistic infrastructural map that it would launch in December 2017.
He also highlighted the local content growth which the Nigeria Oil & Gas sector has experienced, which he said, has moved from 5% at the inception of this Administration to about 40% local content compliance currently.
He made this known while discussing issues relating to infrastructural development in the sector in a meeting with the Secretary of Energy of the United States of America, Mr. Rick Perry at the sidelines of the 24th Africa Oil Week currently holding in Cape Town, South Africa as part of his ongoing investment focused international Oil and Gas engagements.
Kachikwu also used the opportunity to invite the Secretary of Energy and his team to participate in the forthcoming maiden edition of the Nigerian International Petroleum Summit (NIPS) scheduled to hold in February 2018 in Abuja, Nigeria.
While speaking at the meeting, Rick Perry commended Nigeria on the significant steps taken in the Oil and Gas Industry, and stated that the key message and thrust of the United States administration is to be strategic partners with Nigeria.
He further stated that the United States Government has a high level of respect for the people of Nigeria and pledged willingness to continue to encourage US companies to invest in Nigeria’s oil sector.
The ministry’s Director, Press, Idang Alibi disclosed this in a statement issued to journalists on Wednesday.
According to the statement, the landmark meeting which is the first of its kind between the two leaders of the energy sector in both countries since the inauguration of the new administration in the United States comes as a follow up to an earlier meeting that was hosted by the Office of the Secretary of Energy earlier in May 2017 at the United States Departments of State and Energy in Washington D.C. at the sidelines of the Offshore Technology Conference (OTC).
The Minister of State while responding to the comments and feedback given by Mr. Rick Perry said the Federal Government of Nigeria under the leadership of President Buhari has clearly set out the choices that have to be made as nation over the next 4 years and have also taken significant steps in achieving this through the continuous implementation of the 7BigWins – the Nigerian Petroleum roadmap; which focuses on stabilizing the business environment, enshrining openness and transparency, and developing and entrenching new policies and regulations. These laudable achievements have contributed greatly in helping Nigeria claw back from the recession.
Dr. Ibe Kachikwu restated the positive role the Government has played through the instituting of the Joint Venture cash call payment agreement, ensuring adherence to due process in the sector, promoting accountability, encouraging sanctity of contracts and reviewing the Fiscal Policy to provide incentives for investment in the sector while optimizing revenues for the Government. He also hinted that plans are in place to reduce Government’s role in the sector in order to increase private sector participation.
Finally, Mr. Perry, in his closing remarks at the meeting informed the Honorable Minister of State, that the United States Government would be willing to assist Nigeria with access to newer technology and skill set training to deepen Nigerian participation and production in Oil and Gas. He further extended an invitation to the Honorable Minister of State, Petroleum Resources to come to the United States to take a look at the Department of Energy sector laboratories which specifically develop new technologies being currently deployed in Oil and Gas.
The Chairman of Peoples Democratic Party (PDP) South African chapter, Hon Ekos Akpokabayen have called on Nigerians at home and in the diaspora to resist every intimidation aimed at silencing their democratic voice by the present APC led government and demand their rights with regards to administrative responsibility.
Akpokabayen made this known in a statement issued to The Nation, said that Nigerians should not be cowed to continue believing that the high-level incompetence, corruption and the military democracy they are witnessing today under Buhari and the APC almost 3 years down the line is still about the said errors of the PDP as they were made to believe from the beginning.
He noted that the recent corruption and counter corruption revelations under the present Buhari and APC-led government should serve as an eye opener for Nigerians all over the world. A lot has been covered and most of them swept under the carpet because the Nigerian masses are intimidated not to ask questions, we are slowly and tactically returning back to the era of military regimes which we all collectively vomited out over a decade ago.
Akpokabayen, who have consistently lend his voice against ill governance in Nigeria said “It is time for every Nigerian who can see clearly to rise and ask questions and demand for accountability, we must refer President Buhari and his APC back to the 81 point bogus campaign promises which one very prominent among them is that “all public office holders under the APC led government must be barred from seeking Medicare overseas” which he the president himself has violated over and over again”, he said.
Hon Ekos Akpokabayen
Akpokabayen noted that the discovery a few days ago by the wife of the president, Hajia Aisha Buhari on the total emptiness of the state house clinic in Aso Rock, is very revealing, “I had to go back to those campaign promises because if Buhari and the APC made such promissory vow to Nigerians as part of their joker to deceive them into getting them to power, then it is the time to ask them to give account.”
He added that the same president who made bold with the above promissory vow allotted billions of taxpayers’ money from the 2016 and 2017 and even beginning from 2015 national budgets respectively for the running of the same clinic which is solely meant for him but which he never visited even in his times of medical needs, instead he left the country for the United Kingdom in breach of his avowed campaign promises where another bunch of hundreds of millions of taxpayers’ money were wasted on different medical visits/vacations which ran into several months.
He asked how many of our hospitals are being maintained and functional today? If only the same state house clinic under review received over N11 billion yearly budgetary allocations and yet the sole beneficiary never visited it for once then it is time for Nigerians to redefine “corruption”,
Akpokabayen said: “it should baffle Nigerians that given all the billions that have gone down the drains so far, it was only few days ago that the wife of the president could discover the monumental rot under her husband’s administrative nose yet he has been chasing shadows outside in the name of trying to kill corruption, non-accountability to me is the worst kind of corruption, followed by nepotism which is the order of the day here as it is now”.
He further stated that Nigerians under the new administration were deceived into accepting the unnecessary increment of the prices of petroleum products especially the Premium Motor Spirit (PMS) with yet another bogus promise of using the proceeds to develop infrastructures and better the lives of the masses, almost 2 years have gone, nothing, not one thing to show for it, and Nigerians have once more learnt and resolved to live with it without no questions.
On the issue of the most recent $25 billion frivolous contracts scandal at the NNPC as exposed by a first line insider, the minister of state for petroleum Dr. Ibe Kachikwu which has been greeted with conflicting narratives as to what and how it happened, said that it is another memorable act of corruption that should not go away so quickly from our hearts unquestioned.
This, he stated that calls for serious concern by Nigerians, such revelation coming from an NNPC front-liner and the very minister of state for petroleum is over-weighty for us to allow it to be settled and come out to display some fraudulent coloration of facial smiles and handshakes on national television stations, it will be an error of the century for Nigeria and Nigerians”, it amounts to yet setting the worst precedence for our great nation,” he said.
He called on members of the PDP across the world to reposition themselves for the grand take overcome 2019.
“We must do all it takes and use every instrument of truth to enlighten Nigerians on the foundational defects, lies, propaganda, calumny, misrule, dictatorial military democracy, high level and very tactical corruptions, disrespect to the rules of law, Human Rights abuses all over the nation”, he said.
He continued: “I plead with my party, the PDP that there can never be any other time than this for us to come together, get all the fact on the table and begin to show Nigerians the very clear difference between a true democracy and a faulty one which is militarized.
The fire outbreak in the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu Abuja house was not an act of sabotage, it was learnt on Monday.
The Deputy Director, Press, Ministry of Petroleum Resources, Mr Idang Alibi, who confirmed that there was a fire accident in the house, described the accident as a normal domestic accident that could happen in any house.
Asked on phone to confirm whether there was a fire accident in the house as reported in online media, the Deputy Director, responded in the affirmative.
There were reports in the social media that minister’s residence caught fire on Sunday.
But pressed to give details of the circumstances that resulted in the fire, the director said that “it was a normal fire outbreak that happens in a house. If you are suspecting that it is an act of sabotage, it is not. It is a normal usual fire outbreak that happens in any home.”
He, however, noted that the fire only had a negligible effect on the house”
The private residence of Ibe Kachikwu, minster of state for petroleum resources, located in Asokoro, Abuja caught fire on Sunday evening.
According to online sources, the fire is said to have started in his bedroom as a result of a suspected electrical fault to the air conditioners.
“Kachikwu was not at home when it happened, but thankfully the fire service reacted quickly and put out the fire before things could go out of hand,” our reporter gathered.
Details are scanty on the extent of damage to the house but we understand that nobody was hurt in the incident.
The minister has been in the news recently over his letter to President Muhammadu Buhari in which he complained about insubordination and humiliation by Maikanti Baru, the group managing director of the Nigerian National Petroleum Corporation ( NNPC ).
The claim by that the Nigerian National Petroleum Corporation, NNPC’s Tenders Board is the only legal body to approve contracts and not the Board is false.
Associates of the Minister of State of Petroleum, Dr. Ibe Kachikwu, stated this in a fact-sheet available to The Nation on Wednesday.
The fact-sheet was in response to NNPC’s Monday statement, which described Kachikwu as a “liar” with his August 30 memo to President.
Kachikwu wrote to President Muhammadu Buhari, alleging that NNPC’S Group Managing Director, Maikanti Baru
awarded $25billion contracts unilaterally;
ran a “bravado” management; and
made appointments without consultations.
Baru denied it all. He said no money was involved in the contracts and that the NNPC Tenders Board had no business reporting to Kachikwu and the corporation’s Board. The Presidency backed his position.
The fact-sheet however said: “Baru’s claim that the NNPC Tenders’ Board, not the NNPC Board, is the right body to approve such contracts in question is also false. According to Public Procurement Act’s Section below:
S.20. (1) The accounting officer of a procuring entity shall be the person charged with line supervision of the conduct of all procurement processes; in the case of ministries the Permanent Secretary and in the case of extra-ministerial departments and corporations the Director-General or officer of co-ordinate responsibility.
(2) The accounting officer of every procuring entity shall have overall responsibility for the planning of, organization of tenders, evaluation of tenders and execution of all procurements and in particular shall be responsible for.”
“Apart from the GMD as the appointor of the Tenders’ Board, which he also chairs, his duty is purely to plan, organise, evaluate, execute and supervise the conduct of ‘procurement processes’ and not to approve contracts above his threshold under the seal of the Corporation.
“He cannot plan, organise, evaluate, execute procurement process, approve and execute approved projects. He lacks the statutory capacity to be the sole determinant of due process in the corporation.
“But after the approval by the NNPC Board, President or FEC, it is worthy of note that the Tenders’ Board, according to Public Procurement Act in Section 22 (3), ‘shall be responsible for the award of procurement of goods, works and services within the threshold set in the regulations.”
“Under the seal of the NNPC Board, according to the First Schedule, Part A, Sections 11, 12 and 13 of the NNPC Act which says:
“11. The fixing of the seal of the Corporation shall be authenticated by the signature of the Chairman and any other person authorized in that behalf by the Board.
Any contract or instrument, which if made or executed by any person not being a body corporate would not be required to be under seal, may be made or executed on behalf of the Corporation by any person generally or specially authorised to act for that purpose by the Board.
Any document purporting to be a contract, instrument or other document duly signed or sealed on behalf of the Corporation shall be received in evidence and, unless the contrary is proved, be presumed without further proof to have been so signed and sealed.”
The federal government has hinted that a stronger, larger petroleum industry regulator will emerge after the passage of the Petroleum Industry Bill.
Speaking at one of the breakout sessions of the 2nd Nigerian Economic Summit in Abuja Tuesday, Minister of state for Petroleum Dr. Ibe Kachikwu said “we are still working to make it better, by the time the senate and the entire national assembly finishes what they are doing we are going to see a much stronger, a much larger independent regulator.”
According to Kachikwu, “whatever model of PIB that we are pushing, the point that Dr Baru made is very, very key to see an independent regulator with very enormous powers, with less of political interference so that individuals could do their work and also whittling down the powers of the minister so that these institutions could work and work well.”
Kachikwu noted that “the reality is that no one will work as a minister forever, you are going to hand over that portfolio. We should be looking for the system surviving and been able to work well, so it’s something that we are working with the Assembly very hard on and I think if you look at the issues that come up, there are a lot of emphasis on that independence.”
Kachikwu also said “the federal government would develop Policies that ensures the global decline in fossil energy does not take Nigeria unawares, stating that government is already thinking in that direction.”
Kachikwu who moderated a panel discussion on energy in a break out session with the Group Managing Director of NNPC Maikanti Baru said “the federal government is currently dealing with the fundamentals of ensuring that the refineries work, and ensure availability of energy sources to meet our day to day energy needs.”
Kachikwu noted that, “the NNPC would have to take over the commercial aspects because they are going to be the one deploying it. As the Refineries get kitted up, we would continue to look at new fossils development programmes, and will see a need to pump out policies that would enable Nigerians see the advantages in terms of costs.”
Reacting to questions on the bidding for marginal fields, Kachikwu said “the government is determined to ensure transparency in the bidding process so that the public always gets to know who and who gets what and could monitor the progress.”
According to him, “these are some of the issues the Niger Delta communities are always inquiring about and indeed all Nigerians. The more transparent it is, the better for us. We are developing models to ensure better regulations geared towards transparency in the bidding process, and we would alert Mr. President as soon as we are done “Kachikwu notes further.”
Maikanti Baru, the GMD of NNPC in his own remarks at the panel raised concern that only nine out 14 of those who won the bidding process for the marginal fields are operating a development he described as “not good.”
He was however assured by the minister of state for petroleum, Ibe Kachikwu that “the Ministry of Petroleum Resources would work closely towards ensuring that concerns and constraints that had hindered the remaining companies who have not swung into action in the marginal oil fields are appropriately addressed.”
An advocacy group, Accountability Vanguard (AV), has roundly condemned the attempt by the NNPC and some politicians to blackmail and denigrate the Minister of State for Petroleum Resources, Ibe Kachikwu, on the allegations he levelled against the NNPC.
In a statement signed by its spokesperson, Comrade Ojelabi Victor, the group said attempts by the state-run firm to try to dismiss, and render irrelevant the allegations levelled against it by the Minister of State for Petroleum Resources, Ibe Kachikwu, Maikanti Baru-led body failed to address the key issues raised by the minister.
Recall that Kachikwu’s memo to the Nigerian president, which was allegedly leaked, raised quite some dust that bordered around insubordination, corrupt practices and abuse of contracting process.
The group said the attempt by Baru to defend the indefeasible only confirmed part of the allegations, while most were mainly ignored.
“The GMD of NNPC claimed that ‘he only needed to get the input and the approval from the president, who is also the substantive Minister of Petroleum Resources’. It got interesting when he went further to assert that ‘Mr. Buhari, as the president and Minister of Petroleum, was the chairman of the NNPC board and the approval he received from him was sufficient.’
“What Mr. Baru forgot to factor in his jaundiced unhurried response was that the position of the NNPC board’s chairman has been ceded to the Minister of State for Petroleum Resources, Ibe Kachikwu!
“The act setting up the state-run oil firm empowers the president to delegate someone as the chairman of NNPC board, despite the fact that the president can still act in same capacity without invalidating the position of the delegate.
“Looking at this holistically, where has Kachikwu gone wrong in his allegations? Let him be!
“Another issue raised by in the leaked memo was that of corruption and abuse of contracting processes. This was not included in the NNPC’s response to the minister.
“This, however, did not come as a surprise because the issue of insubordination addressed was secondary, the primary issue which borders on fraud is the contracting process. It’s unfortunate that a firm of the government expected by the act setting it up to be apolitical, like every other sector in Nigeria, has fallen to corruption.
“It is high time we understood that corruption doesn’t come about only when money is misappropriated but also where fairness and openness are compromised.
“According to the NNPC handbook on award and execution of contracts, the organisation must be open, economical and transparent in accordance with the provisions of the law and without regard for self-interest.
“It goes on to state that by the provisions of the Public Procurement Act 2007, the NNPC Tenders Board is the final approving body for NNPC awarded contracts. And any contracts for a value beyond the financial limits of the NNPC Tenders Board will go via the Board to the Federal Executive Council (FEC) for approval.
“The act also stipulates clearly the limits for financial approval by each level of the government and NNPC thus, Federal Executive Council (FEC)—(From N2.70billion or from $20million), NNPC Tenders Board—(From N1.40million up to N2.70billion and $410million up to $20million, Group Executive Committee (GEC)——(From N540 million up to N1.40 billion and from US$4 million up to US$10 million) and Directorate Executive Committee (DEXCOM)—(From N270 million up to N540 million and from $2 million up to $4 million.
“By reviewing what the minister alleged, he specifically pointed out that ‘$26billion was awarded without due process’. If Baru’s as NNPC has done no wrong, why was this part and that of personnel appointments omitted in his response?” the group said.
Until his appointment as Minister of State for Petroleum Resources in 2015, Mr. Kachikwu was the Executive Vice Chairman and General Counsel of Exxon Mobil (Africa).
He had earlier served as the GMD of NNPC until July 2016.
A first class graduate of law from the University of Nigeria, Nsukka, and the Nigeria Law School, he also holds masters and doctorate degrees in law from the Harvard Law School.
He started his working career with the Nigerian/American Merchant Bank before moving on to Texaco Nigeria Limited from where he joined Exxon-Mobil.
