The Nation Newspaper

Tag: NNPC

  • Nigeria’s economy in dire strait, says Fashola

    Nigeria’s economy in dire strait, says Fashola

    • NNPC under-remitted N2.4tr

    LAGOS State govenor District 13 Babatunde Fashola (SAN) has painted a very grim picture of Nigeria’s economy saying the situation demands urgent attention.

    Addressing members of the state House of Assembly on the state of the nation at plenary yesterday in Lagos, he complained that the Nigerian National Petroleum Corporation (NNPC) under-remitted N2.4 trillion to the Federation Account.

    The governor, who was visibly saddened by the situation, gave the impression that no state would be able to meet its target for the year 2014 as the 36 states of the federation are in serious financial problems.

    According to the governor, for the first time in almost 14 years of the nation’s democratic experience, the country has recorded walk-outs staged by commissioners of finance during meetings of the Federal Accounts Allocation Committee (FACC) in Abuja.

    He said the first one happened in 2011, while the country witnessed more of such walk-outs last year due to irreconcilable accounts of the federation.

    As a result, he said, some states have had to borrow to keep the government going.

    He said:“The reasons for those disagreements were largely reported revenue declines that were disputed by the various states as represented by their various finance commissioners,” he said, adding that the pattern had continued right from the second half of last year to January this year.

    “Now whilst this revenue decline has gone up, we have been unable to hold the National Economic Council (NEC) meeting in Abuja.

    “In the past, the meetings had held every month. The meeting has not been held now for, at least, six months in spite of clear revenue declines.”

    He said the NEC is a forum for the discussion of economic issues concerning the 36 states of the federation and it is made up of governors, the Governor of the Central Bank of Nigeria (CBN), the ministers of National Planning, Finance and others. The meeting is chaired by Vice President Namadi Sambo.

    He said the revenue decline should have been a major issue for discussion at the NEC meeting since the constitution of the country provided for it.

    Fashola reminded the House that he had always complained of decline in revenue and the inability of the state to meet optimal budget performances, lamenting that the government has left social services to meet welfare needs of personnel.

    According to him, the revenue declines are credited to “what is characterised as uncoordinated and discretionary application of the Federal Government’s fiscal policy on waiver and negotiating the duty credit certificates.”

  • Insist on fiscal federalism, Fayemi urges lawmakers

    Insist on fiscal federalism, Fayemi urges lawmakers

    Ekiti State Governor Kayode Fayemi has lamented the poor fortune of states in the “sham Nigerian federation”.

    In his “State of the State” address to the House of Assembly yesterday, Fayemi urged the lawmakers to join the struggle against “repressive federal power.”

    He said: “Because every state in Nigeria depends largely on the allocation from the federation account and the annual budgets of states are predicated upon earnings from the federation account, any major change, due to poor handling/depletion of the nations’ resources, will expectedly have ripple effects on the implementation of budgets at the state and local government levels.”

    Fayemi said Nigeria earned more revenue from oil sale in 2013 and 2014 than budgeted, given the fact that “the average oil benchmark prices in the national budget are $79 per barrel for 2013 and $77.5 per barrel for 2014”, adding: “At no time did Nigerian oil sell less than $95 in 2013 and $110 in 2014.”

    He urged the Assembly to critically assess the revenue going into the federation account and direct that they should be reported in the consolidated revenue fund.

    The governor called for the abolition of the excess crude account, saying it allows the Federal Government to “manipulate” the proceeds into the federation account.

    He urged the Assembly to join in the struggle to ensure the separation of the Office of the Accountant-General of the Federation and the Office of the Accountant-General of the Federal Government; creation of the Office of the Auditor-General of the Federation, which shall be separate from the Office of the Auditor-General of the Federal Government; audit of Nigeria National Petroleum Corporation (NNPC) account; payment of outstanding revenue due to the federation account by NNPC; and review of the revenue allocation formula, which was last done 15 years ago.

    Fayemi said N4.929 trillion had not been remitted into the federation account in the last three years, noting that the country’s oil proceeds had consistently shrunk due to the alleged schemes of the Federal Government through the consolidated revenue earnings.

    On the Sovereign Wealth Fund for the excess crude account, Fayemi said the deductions by the Federal Government were “insensitive and criminal”, adding: “Ekiti was shortchanged of N481 million in terms of monthly allocations from the federation account between September, 2013 and February, 2014.

    “What we are doing today is necessary to ensure that our people are not left in the dark because Nigeria’s economy depends largely on oil.”

    The governor urged members of the Assembly to alert people of the state’s unstable earnings and the “mismanagement of funds by the Federal Government”.

    He urged the Supreme Court to hear cases of illegal deductions before it to halt the impending financial crisis facing some states due to the paucity of funds.

  • The travails of Sanusi Lamido Sanusi

    The travails of Sanusi Lamido Sanusi

    The former Governor of the Central Bank of Nigeria (CBN), Mallam Sanusi Lamido Sanusi is not my favourite person and I have differences with him on many issues. I must however, commend his immense courage for speaking out and exposing the monuemental corruption in the government that he once served and that has now decided that they no longer require his services.

    Two weeks ago, he claimed that 20 billion US dollars had gone missing from the coffers of the NNPC. Today he has been suspended and relieved of his duties for exposing the rot and speaking the truth. I have little doubt that the next thing that will happen is that he will be subjected to a formal probe and the EFCC will be called in to investigate his tenure of office. They will throw everything that they have got at him including the kitchen sink simply because he refused to play ball with them and cover up their penchant for monuemental corruption and graft.

    Some of us have been there before and we know what it is like. If you speak truth to power and you take on the system be rest assured that the system will fight back and they will attempt to destroy you and all that is yours. Yet none of that matters because the only thing that is relevant is the fact that history and posterity will be kind to Sanusi on this matter based on the choices that he has made.

    He spoke out when others chose to remain silent and to compromise. Unlike others, he refused to sell his soul to the devil and to sell his heritage and birthright for a mess of pottage. Despite the significant differences that I have with this man in terms of our different outlooks to how and what Nigeria ought to be as a nation I salute him and commend him for his efforts.

    I also make bold to say that with his noble stand he has assured himself of a great place in the next dispensation and he will play a key role in the future of this country one way or the other. May God guide and protect him in all his endeavours and may he continue to speak out with courage and strength and not allow himself to be intimidated or silenced.

    Long is the road of righteousness and

    truth and it is often tarred with the

    spikes of persecution, misrepresentation and falsehood. Yet at the end of the day it is the only road that is worth taking and it is the only one that leads to lasting honour and glory.

    May that honour and glory find Sanusi Lamido Sanusi and may God reward him for putting the interests and welfare of the Nigerian people before that of the woeful and rotten administration that he once served.

    This government has once again shown that it has no shame and that it is utterly bereft of any semblance of decency or morality. A man blows the whistle and exposes the fact that 20 billion USD has been stolen and instead of commending him and promoting him he is accused of wrongdoing, criminalised, villified and suspended. It is only in Nigeria that this sort of thing can happen.

    It has happened to me and many others before and now it is happening to Sanusi. I commend his courage and his ability to stand up and speak the truth to power. No matter what the government accuses him of now and no matter what trumped-up charges or baseless allegations they may come up with against him in order to justify their actions, the Nigerian people will always be grateful to him and indebted to him for exposing the rot and filth that constitutes the very foundation of the government that he once served.

    The level of impugnity and disdain that the Jonathan administration has for the people and for probity and accountability is second to none. The message that they are sending is clear- no whistleblower is safe in this country and in this government. Their intention is to destroy all those that have the courage to stand up to them and to intimidate us all into silence but they will fail woefully.

    The more people they seek to destroy for no just cause and the more innocent men and women that they persecute for telling the truth and for exposing their monuemental corruption and incompetence, the more they shall be resisted by people. What they have done to Sanusi is disgraceful and they ought to bury their heads in shame.

    Pertinent and appropiate are Sanusi’s own words when, after he was informed about his unceremonious suspension, he responded all the way from Niger Republic by saying ‘’you can suspend an individual but you can’t suspend the truth’’. He immediately boarded the plane and headed for Nigeria knowing full well that the security agencies were waiting for him.

    The plan was to arrest him on arrival in Abuja but he cleverly diverted his chartered flight to Lagos where close friends of his, including the former Minister of FCT Mallam Nasir El Rufai, a true and loyal friend and brother if ever I knew one, was waiting for him. He managed to avoid arrest but on arrival at Murtala Muhammed International Airport in Lagos the authorities stopped him briefly and took his passport from him.

    By that single act they have served him notice of their sinister intentions. In the coming days, weeks, months and even possibly years they will seek to humiliate him, to denigrate him, to malign him and to destroy his entire future. That is their intention but I firmly believe that it is not the intention of God and consequently they will fail. Providing he continues to stand firm and strong and remains undaunted such an evil plan cannot work and will not work simply because, as the Holy Bible says, ‘’the counsel of the ungodly shall not stand’’. It also says ‘’to subvert a righteous man in his course is not allowed’’ and that ‘’many are the afflictions of the righteous but the Lord will deliver him of them all’’.

    No matter how long it takes and no matter what they put him through Sanusi’s innocence will speak for him before God and before the Nigerian people. It is from the fiery furnace of persecution, misrepresentation and victimisation that true heroes are born. There is a spirit that emboldens and that stirs the passion and the soul of true warriors once they are sufficiently provoked. That spirit is known as the spirit of truth and it cannot be intimidated or denied.

    I must confess that it is very clear to me that Sanusi has that spirit and is possessed by that virtue. I say this because he was intelligent enough to know that with his utterances and his explosive disclosures about the graft in the NNPC and at the Ministry of Finance he was stepping on very powerful toes, treading on very dangerous grounds and swimming in very troubled waters. Yet despite the obvious dangers he continued and he was quite unmindful and unperturbed about what the direct consequences of his actions may be in terms of his personal safety, the security of his tenure of office or his career as a public servant.

    He was prepared to stand by and

    speak the truth no matter what

    and he was prepared to pay any price no matter whose ox was gored. That is the stuff of which heroes are made and I salute his courage. How I wish that more of our people were made of such stern stuff. If President Jonathan was really interested in fighting the war against corruption he would stop using his security agencies from tormenting and harassing innocent people.

    If he wanted to suspend some of his key officials and if he really wanted truth and justice to prevail he would not have targetted an innocent whistleblower who had constituted himself into a thorn in his flesh but instead he would have suspended Mr. Andrew Yakubu, his Group MD of NNPC, Mrs. Dieazani Allison-Madueke, his alluring Minister of Petroleum Resources and Mrs. Ngozi Okonjo-Iweala, his Minister of Finance pending the investigation into the missing 20 billion USD. Until he does that and as long as he continues to cover them all up and treat the Nigerian people with contempt and impugnity, no right-thinking person will take him or his administration seriously. This is all the more so for the following reasons. Firstly because it is a matter of public record that the accounts of NNPC have not been audited since 2005, secondly because Mrs. Allison-Madueke and the NNPC have admitted that 3.5 billion USD was spent on kerosene subsidy without appropriation and specifically against Presidential directives and thirdly because, Okonjo-Iweala has conceeded that at least 10.5 billion USD has gone missing and she has called for a formal probe into the whole matter so that all the figures can be reconciled. How I wish that at this point she would have resigned. The Ngozi that I once knew, who was a woman of impeccable breeding and deep substance and character, would certainly have done so.

    Sadly not many of the Jonathonians are familiar with the works of William Shakespeare simply because Shakespeare is not too popular in the creeks. Yet the few amongst them that are up to the task would do well to consider the words of Julius Caeser when he said “it is the custom of the immortal gods to grant temporary prosperity and a fairly long period of impunity to those whom they plan to punish for their crimes, so that they may feel it all the more keenly as a result of the change in their fortunes”. Those amongst the President’s supporters that truly love him and that have his interest at heart would do well to explain to him the import of these deeply profound words and wise counsel from Shakespeare’s ‘’Julius Caesar’’. In doing so they may save him and his entire court of royal jesters from a whole load of misery that undoubtedly awaits them in the future. As for Sanusi Lamido Sanusi it is very clear to me that the sky is the limit for him. Whether he likes it or not his journey into the turbulent world of partisan politics has just began and I suspect strongly that he has an appointment with destiny.

    Permit me to end this contribution with the following observation. In the last few days, much has been made about the fact that I have criticised Sanusi quite often in the past and that I have openly disagreed with some of his actions as Governor of Central Bank. It has also been said that on another occassion I raised some fundamental questions about what I described as his ‘’flawed and indefensible’’ position on the oil subsidy debate in 2012, his controversial views on Boko Haram, his position on revenue allocation vis a vis north and south and his harsh and historically inaccurate assertions about the Yoruba people a number of years ago. It is true that I opposed him on those matters and that I took those positions on those issues and I stand by each and every one of them. I do not see any big deal in that. Yet, many appear to be rather surprised that I would now be one of those that is defending the very same Sanusi that I have opposed in the past.

    Those that have expressed such surprise and that see this as some kind of glaring contradiction simply do not understand me. And neither do they appreciate the complexities of national debate and the importance of being completely detached and objective when it comes to any form of intellectual or public discourse. The truth is that I do not take positions against individuals but rather on specific issues. Hence I may be your friend and defender one day and your greatest critic and detractor the very next depending on what your position is on any specific matter. That is the essence of public discourse and intellectual debate. That is it’s nature. We must not be motivated or moved by personal considerations or by our love or hate for any individual but rather by principle, morality, logic, facts and figures, justice and the rights and wrongs of the specific issues of the day. No-one is all good and no-one is all bad. And neither is anyone, including yours truly, always right.

    The fact that I have disagreed with Sanusi over the last 20 years on a number of matters including his assesment of the Yoruba people, his views about the cause of the scourge called Boko Haram, the oil subsidy issue and the ‘’National Question’’ does not mean that I ought to support the fact that he is being treated in the most deplorable way by President Goodluck Jonathan. Though he and I disagree vehemently on many things it does not mean that we are enemies for life and neither does it mean that I should relish in it and remain silent when he is being treated unjustly and when he is being persecuted, humiliated and rubbished by the Federal Government. This is all the more so when he has courageously exposed the rot in the Jonathan administration. He may have got it wrong on other matters but on this issue I make bold to say that Sanusi got it right and he did the proper thing. He deserves my support, just as he deserves the support of all right-thinking people, and he can be rest assured that he has it.

     

  • Petrol scarcity bites harder

    Petrol scarcity bites harder

    Motorists and commuters across the land could not have had a worst weekend than this as more filling stations ran out of supply yesterday.

    And where fuel was available, the price was outrageous, ranging from N105 to N250 per litre.

    The immediate effects were long queues at such filling stations, scarcity of vehicles for commuters and exorbitant transport fates.

    It was not clear when the situation might improve.

    Many motorists in Lagos spent much of yesterday looking for fuel to buy.

    They had to queue at fillings stations, and where such queues extended to highways as it happened in many cases, the result was traffic jam.

    Many people who, had social engagements had had to cancel such so that they might not burn the petrol they had already.

    The situation also left motorists in Ado Ekiti spending endless hours at the few filling stations which have product to sell yesterday.

    Some petrol stations claimed that they had exhausted their supply and they the few ones that were selling did so for prices ranging between N110 and N115 per litre.

    The situation has forced a hike in transport fares to destinations within and outside the state.

    Commercial motorcycle operators have also increased their fares by about 28 per cent.

    There was no queue for fuel in Enugu, although transport fares went up by between 50 and 70 percent depending on the distance.

    Black market operators are having a field day in Makurdi and environs, capitalising on the furl scarcity to increase prices.

    They charge between N180 and N220 per litre.

    Some motorists said they joined the queue at the NNPC mega station on the Makurdi- Otukpo road as early as 4am to buy fuel and ended up getting only 20 litres, the maximum quantity approved for each motorist at the control price of 97 naira per litre.

    Thousands of commuters were stranded in Benin on the account of the fuel scarcity.

    Queues formed by motorists at some filling stations were up to one kilometre.

    The situation was particularly bad in Port Harcourt where almost all the petrol stations claimed to have run out of supply.

    This has left the black market thriving.

    The State Government had to step in, sealing off two filling stations, Oando and Conoil, in Eleme Local Government Area of the state for allegedly hoarding petroleum products.

    The Commissioner for Energy and Natural Resources, Mr. Okey Amadi, alleged that the affected filling stations, apart from hoarding petroleum products, were also involved in fraudulent meter adjustment.

    Commuters in Awka, the Anambra State capital pleaded with government to find an immediate solution to the problem.

    They said the prices they are being forced to pay for petrol were beyond their means.

    Calabar was like a ghost town as many vehicles were off the road owing to the fuel scarcity.

    Only the NNPC mega station had the product which it sold at the control price of N97. The queue at the station was several kilometres long.

    The Independent Petroleum Marketers Association of Nigeria (IPMAN) chairman in Cross River State, Michael Udofia, said they were not hoarding petrol as being speculated.

    He said:”We don’t have any product. Even throughout the Christmas period, there was no scarcity. Even then when there were so much activities, petrol was not hoarded. So why should we hoard it now. For the past two years we have not had scarcity. So this is not our making.

    “We have about 14 depots in the city and none of them is working. Even the NNPC depot was not working. So we have not been supplied with the product and that is why there is scarcity.”

    The situation was not different in Bayelsa and Delta States.

    Transport fares from and to the commercial city of Onitsha have jumped up caused by the fuel scarcity.

    Some Lagos residents urged the Federal Government to address the lingering fuel scarcity in the state, to make life more meaningful for the people.

    The residents told the News Agency of Nigeria (NAN) that commuters now wasted a lot of time at bus stops as the fuel crisis takes a turn for the worse.

    Fuel queues were long at some filling stations, slowing down traffic on major highways.

    An artisan, Mr Yusuf Ismaila, told NAN that he was at a filling station for over two hours and was not been able to buy fuel.

    “I do not know why we suffer for basically everything in this country.

    “There is no frequent power supply and now that we have a generator to use, getting fuel is also a problem.

    “I have been on the queue for over two hours,” he said.

    Ismaila advised government to tackle the fuel shortage and to also address the epileptic power supply in the country.

    A commercial bus driver, Mr. Jare Olawale, said it was unfortunate that Nigerians were experiencing fuel shortage at this point in time.

    He said the scarcity had encouraged sharp practices by filling station attendants, who now made brisk business.

    He said that a litre of petrol now attracts over N100 at some filling stations against the official price of N97.

    “I have been on this queue for about an hour before I was able to buy petrol. This is very bad,’’ Olawale said.

    A businessman, Wale Shogeyinbo, said he was not happy with the fuel scarcity as it had disrupted his business.

    “As a businessman, I operate a viewing centre, where you can watch football and play games but now, the business is affected because of scarcity of fuel,” he lamented.

    A lawyer, Mr. Andrew Rotimi, expressed disappointment over the lingering fuel shortage in the country.

    NAN checks indicated that commuters now pay more with a trip from Ikotun to CMS on Lagos Island, which used to cost N300 now attracting between N350 and N400.

    Some attendants at the stations told NAN on condition of anonymity that they were selling at the price they got the new stock, which they said, was now higher.

  • An elitist sermon

    An elitist sermon

    The NNPC GMD’s call to use gas instead of kerosene  sounds like what triggered the French Revolution

    The wife of Louis XVI, Marie Antoinette, wondered why the protesters on the streets of Paris clamoured for bread when they could have cake. It infuriated them, and led to a rabble that torched the city and the French monarchy.

    Similar language came from the leadership of Nigerian oil. We know that there are advantages in switching from kerosene to Liquefied Petroleum Gas (LPG). These include the provision of a cleaner and safer fuel option, especially for lower income households, reduction of indoor air pollution that causes significant health problems and a decline in carbon emissions caused by dirty fuels; but the decision of which to use should be for the consumers to make. It should not be imposed on them in a manner akin to the ‘if you can’t find bread, eat cake’ fashion. That is why it is not a befitting sermon from the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mr Andrew Yakubu, and the chief executive of the Pipelines and Product Marketing Company (PPMC), Mr. Haruna Momoh, two people who are critical to making kerosene available in the country but have failed to do, to ask Nigerians to switch from kerosene to LPG.

    Messrs Yakubu and Momoh, while testifying before members of the Dakuku Peteside-led House of Representatives Committee on Petroleum (downstream) investigating supply, distribution and subsidy expenditure on kerosene from 2010 – 2013, said the solution to the lingering kerosene scarcity lies in switching over to LPG because this will reduce pressure on kerosene and ultimately lead to a drop in the demand for it. This excuse is full of the usual trappings of public officials who rather than be pragmatic about solutions to our problems sniff for excuses for the easy way out.

    The duo failed to take cognisance of the fact that cooking gas is costly and is beyond the reach of many Nigerians. One reason for this is the absence of a clear-cut policy to drive LPG consumption by the Federal Government. The fact is that deliberate government policies account significantly for the much progress made in countries like Brazil and Morocco, where LPG consumption is high. There is also the fear of gas in our society that would make people prefer kerosene that they perceive as safer and easier to handle. So, unlike Brazil and Morocco, the Federal Government will have to work harder to convince Nigerians to use gas.

    There was nothing new in whatever the duo told the House of Representatives committee members, either from the point of view of economics, or environmental safety. But what they failed to add is that even their own recommendation will come to naught if the same business paradigm they are using in the NNPC, for instance, is transferred to the process of producing the LPG. It is scandalous that Nigeria, a major producer of crude oil imports the bulk of the fuel that is used in the country. And there are reasons for these, including corruption and governmental ineptitude. For these reasons, it will only be a matter of time for the same problems leading to scarcity of kerosene to afflict the production of LPG. This is one ‘Nigerian factor’ that Messrs Yakubu and Momoh, as well as many others who have been making a case for LPG for domestic use in the country appear to be overlooking. If we promote LPG for domestic use, which is the ideal thing to do, a time will come when more Nigerians will demand for it and the question of meeting the demand will surface.

    This is why we think the prescription of the duo is symptomatic of the typical Nigerian public official’s penchant to sidetrack rather than solve problems. Rather than tell Nigerians why kerosene remains scarce, which was the essence of their appearance before the House committee in the first place, they launched into the issue of LPG as solution to the scarcity. How does that explain why kerosene remains scarce despite the humongous amount the government pays as subsidy on the product? Yakubu himself admitted that about N8.49 billion was expended to subsidise a total of 5,015.413.022.06 trillion litres of kerosene in 19 months! So, why is the product still scarce?

    We know as a matter of fact that petroleum products are being smuggled out to neighbouring countries. We are also aware that the activities of pipeline vandals, the state of disrepair of pipelines and depots in the country, and the activities of unscrupulous elements who adulterate kerosene to sell it as automatic gas oil often referred to as diesel, all contribute to the scarcity of the product. All these are issues the government should tackle because they are the reasons why government exists in the first place. For as long as these issues are unresolved, it is immaterial whether Nigerians use kerosene or LPG, there will always be scarcity at some point.

    So, we restate: if cooking gas must be substituted for kerosene, it should be by choice and a deliberate policy on the part of government; it does not lie in the mouths of those who should make kerosene available and have failed in that responsibility to seek to impose gas on Nigerians. That looks to us a subterfuge to cover their shortcomings and the general ineptitude in the country. It is cynicism taken too far.

  • NEITI and NNPC’s ‘complex’ accounts

    When the suspended Governor of the Central Bank of Nigeria (CBN), Sanusi Lamido Sanusi, alleged that the Nigerian National Petroleum Corporation (NNPC) was yet to remit $10.8 billion to the Federation Account, the oil firm’s leadership accused him of confusion and ignorance.

    Labouring to defend his dismissal of Sanusi during his last media chat, the president referred to how the CBN chief had tied himself up in knots bandying different figures allegedly not remitted by the NNPC.

    Now, it appears that the list of the ‘ignorant’ and ‘confused’ is getting longer. A presentation made by the Executive Secretary of the Nigerian Extractive Industries Transparency Initiative (NEITI), Mrs. Zainab Ahmed, before the Joint House Committee probing the Berne Declaration report, has claimed that not only was Nigeria losing an estimated $8 billion annually through the crude oil-for-refined products exchange arrangement, aka crude oil swaps, NNPC may have failed to remit $22.8billion to the Federation Account.

    Berne Declaration, a Switzerland-based non-governmental advocacy group published a report titled “Swiss Traders’ Opaque Deals in Nigeria” last year.

    The report alleged that every year Nigeria loses billions of dollars as large volumes of oil are exported for well below the market price. It further alleges that the subsidy scheme for imports of refined petroleum products was systematically defrauded.

    NEITI’s Ahmed told the House Committee on Petroleum Resources (Upstream) that the findings came out of its audit report on the finances of the oil corporation for 2009 to 2011.

    Quick as a flash, NNPC spokesman Dr. Omar Farouk Ibrahim reacted to what he argued was an orchestrated campaign of calumny designed to tarnish the corporation’s image. He said sensational headlines had been written misrepresenting the contents of the NEITI report. Significantly, Ahmed has not retracted her assertions before the committee.

    When she appeared before the hearing Ahmed said, “There is similarity in NEITI’s audit report and the Berne Declaration report. The report has a lot of substance in it. NEITI will go back and link the Berne Declaration report with the NEITI audit report.”

    But until Ahmed comes up with damning evidence against the corporation, NNPC executives can sleep soundly – after all they are the only ones who understand this oily business and its peculiar accounts.

    Even statutory agencies that should be combing through the corporation’s books are throwing in the towel. At its budget defence before the Senate Committee on Drugs, Narcotics, Financial Crimes and Anti-Corruption, the Independent Corrupt Practices Commission (ICPC) said its inability to probe NNPC over the years was down to the ‘sophistication’ of the corporation’s accounts.

    Professor Olu Aina, Acting Chairman of the Commission’s board said: “The account of NNPC is so sophisticated that it would require hiring financial experts to study it for needed investigation the cost of which, however, cannot be afforded by us now due to underfunding.”

    As it was in the beginning, so it is now and forever – the words of Sanusi et al against those of executives who keep telling the rest of us “you can’t understand this!” Truly, we just can’t understand: except if the NNPC spokesman is suggesting that NEITI has now merged with the All Progressives Congress (APC).

  • TI backs Fed Govt’s resolve to find missing $20b

    TI backs Fed Govt’s resolve to find missing $20b

    Transparency International (TI) has backed the Federal Government’s directive for a full investigation of how $20 billion allegedly got missing from the Nigeria National Petroleum Corporation (NNPC).

    The body, which spoke through its Chairman, Huguette Labelle, decried the unchecked sleaze being perpetrated by public officials, urging the government to step up its fight against corruption.

    It regretted that corruption was still high in Nigeria despite President Goodluck Jonathan’s pledge for zero tolerance on graft when he assumed contol of the government.

    TI noted that 84 per cent of Nigerians surveyed two years ago gave a verdict that corruption had increased.

    To win the fight against corruption, Labelle said Nigeria needs effective oversight institutions and should detest impunity for sleaze.

    She said: “The news that billions of dollars in oil revenues are not in the country’s national accounts was raised by the governor of the Central Bank and other watchdog institutions. According to Nigerian Extractive Industry Transparency Initiative (NEITI), the NNPC owes the government $8.3 billion in oil revenues for 2009-2011. Finance Minister Dr Ngozi Okonjo-Iweala has also called for an independent forensic audit of the financial accounts of the NNPC.

    “Transparency International welcomes the announcement by President Goodluck Jonathan for a full investigation into the oil sector where $20 billion are alleged to have disappeared from the state-owned oil company. We urge the government to move quickly to investigate how the funds disappeared.”

    The anti-corruption watchdog said it was concerned about how the missing oil revenue is depriving the citizens of a fair share in the nation’s wealth. It said the missing funds could have been invested to improve education, provide good health care system and create jobs for youths, adding that government owed the citizen a duty to get to the bottom of the allegation and prosecute the culpable officials.

    “Missing revenues are depriving Nigerians of a fair share of the wealth that could go to improving health, education and creating employment. The government owes it to the people to investigate the allegation and hold to account those responsible,” Labelle said.

    Despite being Africa’s largest oil producer with the pumping of an average of two million barrels per day, TI said it was surprised that Nigeria has some of the lowest human development indicators in the world.

  • Fresh unremitted $22.8bn found in NNPC

    A fresh $22.8 billion undisclosed proceeds not reflected in the books of the Nigeria National Petroleum Corporation, has been revealed by the Nigeria Extractive Industries Transparency Initiative.

    This disclosure was made known on Wednesday at the Hon. Muraino Ajibola- headed House of Representatives joint committee of Petroleum (Upstream), Petroleum (Downstream) and Justice sitting, investigating the allegation by a Swiss- based Non- Governmental and Advocacy organization – Berne Declaration, that two Swiss oil trading companies, Vitol and Trafigura, in connivance with NNPC have skimmed the country off about $6.8 billion in two years.

    In a 29-page presentation made by the Executive Secretary of NEITI, Hajiya Shamsuna Ahmed, before the joint committee, she said, “these transactions which sum up to $22.8 billion are off balance sheet items (not disclosed in NNPC’s Audited Financial Statements). The implication is that there may be significant contingent liabilities to the Federation that is not being disclosed.”

    According to her, the funds are from the NNPC’s alternative funding/financing arrangements with its Joint Venture partners in form of third party financing from external financial markets and Modified Carry Arrangement (MCA) which are loans from existing JV partners (International Oil Companies).

    NEITI faulted the alternative funding transaction entered into by NNPC on behalf of the Federal Government and recommended that “there is therefore, the need for transparent disclosure of all alternative funding arrangements in the audited financial statements (AFS) of the corporation.

    NEITI also said that $1.73 meant for Joint Venture cash calls have been diverted by the NNPC.

    “Non cash call items totaling $1.73 billion were financed from the CBN/NNPC JP Morgan Chase Cash Call Dollar Account. This reduced the amount available for funding JV operations with the attendant implications of NNPC seeking alternative funding arrangements to fund cash call shortfalls,” NEITI said.

     

  • Reps probe: Nigeria loses $8 billion yearly through NNPC swap arrangement

    Reps probe: Nigeria loses $8 billion yearly through NNPC swap arrangement

    •Swap deal was transparently done, says NNPC

    Nigeria is losing about $8 billion yearly through a swap agreement entered into by the Nigerian National Petroleum Corporation (NNPC), it was revealed yesterday.

    The revelation was sequel to the joint House of Representatives Committees of Petroleum (Upstream), Petroleum (Downstream) and Justice investigation on the allegation by a Swiss-based Non Governmental and Advocacy organisation called Berne Declaration, that two Swiss oil trading companies, Vitol and Trafigura, in connivance with NNPC, have skimmed the country off about $6.8 billion in two years.

    The hearing came about via a motion by a member, Abiodun Balogun (APC, Ogun).

    The joint committee yesterday said based on the information before it, the country was losing about $8 billion through the crude-for-product arrangement.

    The NNPC allocated 445,000 barrels of crude oil per day to 10 companies.

    They are:Vitol, Transfigura, Mercurial, Glencore, Taleveras Nigeria Limited, Sahara Energy Limited, Eternal Oil and Gas Limited, Aiteo Nigeria Limited, Ontario Oil and Gas and Rahmaniya Oil and Gas.

    In the deal, companies are allowed to lift crude oil in exchange for petroleum products, such as PMS (Petrol), DPK (Kerosene) and AGO (Diesel). But the joint committee said, in most cases, some of the companies in the deal lift crude oil without supplying products in exchange.

    Based on a report by the Nigeria Extractive Industries Transparency Initiative (NEITI) on domestic allocation for 2011 obtained by The Nation, products of both DPK (kerosene) and PMS (petrol) totalling over 500 million litres were undersupplied to the country in 2011 alone – in a swap agreement contracted between Duke Oil, which is wholly owned by the NNPC in collaboration with the Pipelines and Product Marketing Company (PPMC) and four oil trading firms.

    The companies are: Transfigura, Taliveras, Aiteo Nigeria Limited and Ontario Oil and Gas.

    In answering questions from a member of the Committee, Hon. Ali Ahmad, the Acting Managing Director of Duke Oil, Mr. Ahmed N. Bello, said Taleveras, Aiteo Nigeria Limited and Ontario Oil and Gas were contracted into the deal because of the national local content policy.

    The committee members, however, wondered how nationalistic such a policy was if all the owners of the three indigenous companies were from the Southsouth.

    The NEITI report chronicles how the country has been shortchanged through the crude- for- products.

    Transfigura got two swap exchanges within the period. It under-supplied with 173,786, 600 litres, in the first instance and 654, 440.7 litres, in the second instance.

    Taleveras under-supplied by 152, 308, 878 litres. Aiteo Nigeria Limited’s supplies were short by 193,046,590 litres and Ontario Oil and Gas shortchanged the nation by under supplying 180, 278,772 litres.

    In all, for the year 2011, the total under supplied by the four companies was 500,075,239.3 million litres.

    According to the NEITI report, the deal is a drain pipe for NNPC as Nigeria is losing a staggering amount in revenue. It was also alleged that some of the companies are owing NNPC products worth over $800 million.

    It was also alleged that some of the companies were still lifting crude while the contract agreement signed had expired.

    But the Group Managing Director of the NNPC, Andrew Yakubu, making his presentation before the lawmakers, said the claims of the Bernes Declaration “are baseless and without material substance”. He requested that the committee members “set it aside in its entirety”.

    According to him, the claim by the “Bernes Declaration” that the NNPC is collaborating with Swiss Oil Trading Companies to dispose Federation Crude Oil at lower than market value is not true.

    “We submit that our pricing strategy is aligned to international best practice in the industry. Our prices are based on a reference to the bench mark crude Brent whose prices are published by Plaths for the international community,” the NNPC boss said.

    He said the selection of traders by the corporation “has standard criteria, which evaluate buyers’ facilities, volume of transactions, turnover and financial health of the companies, which is applicable to all, including Vitol and Transfigura.”

    Furthermore, the NNPC said that the crude oil- refined products exchange agreement with Duke Oil started February 1, 2011.

    “PPMC allocates 90,000 barrels of crude oil to Duke Oil Company in exchange for the delivery of refined products equivalent to value of the crude oil.

    “Duke Oil Company operates and manages the swap arrangement by loading three cargoes through its nominated operators Messrs Aiteo Energy Resources Ltd, Ontario Oil and Gas Ltd and Taleveras Group. Each company handles 30,000 barrels per day crude oil contract, which represents one cargo of about 950,000 barrels per month and delivers an equivalent value of refined petroleum products in cargo sizes of 27,000MT to 38,000MT, or as may be agreed by both parties on behalf of Duke Oil.

    The NNPC said at the time of the contract to Duke Oil in 2011, the company did not have sufficient capacity to operate the contract.

    “It, therefore, subcontracted the 90,000bpd to the nominated operators, Messrs Aiteo Energy Resources Ltd, Ontario Oil and Gas Ltd and Taleveras Group to operate the contract at the rate of 30,000 barrels per day per company.”

    The committee members wondered how transparent the contract was, if Duke signed its contracts with Messrs Aiteo Energy Resources Ltd, Ontario Oil and Gas Ltd and Taleveras Group in January 2011. It signed with the NNPC on February 1, 2011.

    The committee said it also needed to know the pricing system of NNPC to see if it meets international best practices.

    It also wanted to know the current list of crude oil companies, as well as know why NNPC is selling to trading companies instead of refineries

    “Is it not curious that when you advertise, it’s only traders that come and not refineries?”

    It asked for the selling prices of the corporation monthly from 2008 to 2013 as well as its joint venture components

    The joint committee also wanted to know who runs Duke Oil, what NNPC pays to those who are running Duke Oil and the JV agreement with Transfigura and Vitol.

    The hearing continues today.

     

  • Why PDP can’t retain Rivers in 2015, by Amaechi

    Why PDP can’t retain Rivers in 2015, by Amaechi

    Rivers State Governor Rotimi Amaechi spoke with reporters in Port-Harcourt, the state capital, on the visit of former President Olusegun Obasanjo to the state, the Peoples Democratic Party (PDP) crises, the future of the All Progressives Congress (APC) and the 2015 elections. Excerpts:

    Why did you request former President Olusegun Obasanjo to commission your projects?

    He was a foremost Head of State and Government that we have had in the country. So, what is wrong in asking him to commission the projects. It was important that he came to have a look at what we have done. Like I told him in the public, we same a common friend and anytime and anytime common friends say what about these things, is Amaechi working, that can be assessed. It was important to bring him so that he can assess things for himself so that next time that question is put forward, he will give them an answer.

    Don’t you think that the President will be annoyed that Obasanjo has taken the shine off him by not being invited to commission the projects as the President and Commander-In-Chief?

    Today, some governors commission for themselves. Would you take offence when they commission their projects by themselves? I saw Fashola recently as he was commissioning projects. I saw Akpabio as he was commissioning a General Hospital. Why will the President take offence about that? It depends on the choice that the governor makes. I can ask the President or governor to commission projects. My colleagues have invited me to commission projects before in Jigawa. I had an invitation from Yobe. Adamawa has invited me. I don’t think that the President will take offence with that.

    Will the commissioning by Obasanjo enhance your profile?

    Well, looking at Obasanjo’s status, you will certainly get some benefits by identifying with him. He is a man with this national clout. I was surprised by the kind of reception he got among the people that came out to receive him. There were those that were brought by the organisers. There were those that came on their own hailing him, shouting baba, calling him all sorts of name, baba iyabo, baba this, Olusegun. Some calling him without respect by calling the former President by such name. I can share this with you. He told us how he acquired the name, Mathew. He said that his parents said that he should have a Christian name and when he got to the secondary school, they looked at how long his names were and one has to be dropped and that he decided to drop Mathew and the reason he dropped Mathew was that Mathew was a tax collector. I think you can’t ignore the fact that identifying with such an important character will rub off on you, and I think positively.

    Does the likelihood exist that you will return to the PDP, which is the predominant party in Rivers?

    You should be careful with your choice of words. How do you know that the PDP is the predominant party? Why can you wait and see whether it is true? You have to be careful. What you assume to be the predominance of the PDP may be the predominance of the manipulation of the elite. It is now that we will source the votes from the down-trodden and then, you can say whether it is a predominantly PDP state or not. I think we should be careful in the choice of such words.

    What is likely to be the fate of the APC in Rivers in 2015?

    I am not God. Don’t give me such powers.

    How about your succession plan?

    I leave that to God. Don’t forget the way I was anointed as the governor. Even, the greatest of all Christians never thought that it will happen. There were occasions where I had sat down in Ghana and asked: how did it happen? I started thinking about these prophets who prophesised that you will be governor and I asked, how will it happen? We don’t know. We just wash and see how God does His things. You must take that into consideration. So, there is God’s elements. Then, you do your human planning. But, I am not focusing on human planning. I am focusing on building a party called the APC because there was none some few months ago. That is why we say, if the PDP says that they are the biggest party , the largest party in Africa, I will say APC is the fastest growing party in Africa. No party has grown at the rapid rate the APC is growing. Some few months ago, there was no opposition party in Sokoto. But, the PDP is now struggling to retain its status as the opposition party in Sokoto. It is the same in Kano. It is the same in Kaduna where the Vice President comes from. And the APC is rearing its head in Bayelsa. So, you can see we are the fastest growing party.

    Are you saying there is tension in the PDP?

    Honestly, the tension in the PDP over the sharing of the loot in Nigeria is enough to put it into crisis. But, look at here now, all of us are at peace with one another.

    What is your comment on the NNPC 20 billion dollar controversy?

    You heard Asiwaju saying that the NNPC is the ATM of Jonathan. We are not involved. We are not talking about it. We will allow the country to decide.

    What does the revelation about the missing oil money portends?

    Nigerians should react. The Governors’ Forum has taken a position that he dwindling revenue at he state level is not because of the oil theft, but because of financial diversion.

    Would all these your projects be completed before you leave or they would be abandoned, especially the mono-rail?

    Where you there when I was interviewing the contractor? Everything about that mono-rail is inside the city of Port-Harcourt. They say they will complete the terminus in October. We will start the power project very soon so that the train will have power to use. The train is built in such a way that, if there is no power, automatically, it will use diesel. You can see the cost. You have power and diesel.