The Nation Newspaper

Tag: NNPC

  • Sanusi’s ‘valedictory’ letter

    Sanusi’s ‘valedictory’ letter

    It seems unlikely that majority of number-numbed Nigerians cared a hoot about the weighty allegations contained in the September 25 letter to President Goodluck Jonathan by the Central Bank of Nigeria Governor, Sanusi Lamido Sanusi, let alone his embarrassing recant at the House of Representatives last week. If the letter was a bomb, the subsequent recant had all the elements of a shove-it-in-your-face Sanusi anti-climax!

    The sum total of the letter is an alleged under-remittance by the Nigerian National Petroleum Corporation, NNPC of a whopping $49.804 billion into the federation account. The allegation, has naturally, spawned strident denial by the corporation.

    If you live in a clime where multiples of billions of public funds routinely take a walk from the public vaults, ordinary citizen ought to be forgiven for seemingly passing off yet another invitation to the join in the elaborate farce of a mock trial and – as it always ends – the spectacle of the post mortem that yields nothing.

    Now, in just under two weeks, the wheel has turned full circle for the CBN governor. If the initial intention was to put NNPC in the dock, it is in fact Sanusi that is in the dock! From his self-assigned role of prosecutor-in-chief, Sanusi now has the burden that he actually knows his onions to discharge – aside the scare-mongering for which he is now infamous. Nigeria may have been described as a country of anything goes, even at that, the astounding revelation of the nation’s chief of treasury, banker to the federal government, member of the economic management team, and statutory adviser to the President being caught flat-footed on a matter as straight-forward as the accounting of the accruals into the federation account obviously takes our officials’ fangled dalliance with mediocrity to record low levels.

    You guessed right: the duel between the NNPC and the CBN is only another window into the chaos that our public finance has become. But then, it also reveals a disturbing character trait in our public officers: their inability to admit when they go wrong – not to talk of offering apologies to fellow citizens they misled! Sanusi of course would wear a placid face – like a piece of stone statue while the charade lasted; his nemeses in the finance, petroleum ministries and the NNPC would in equal measure be content to gloat after the technical knock-out – leaving the rest of us to wonder whether the entire proceeding wasn’t indeed a circus!

    Now, what do we know? Only a little more than we knew before. The riddle of course continues; the riddle of how the nation continues to pump more and more crude and sell at record high prices, and yet has far little to share in the piggy bank. By the way, there is a new phrase in the industry’s lexicon – ‘industrial scale’ used to describe the menace of oil theft. Meanwhile, the books of the NNPC remain inaccessible; just as the state governments as joint beneficiaries from the distributable pool continue to shout themselves hoarse over charges that the corporation remits only what it deems fit into the federation account. The NNPC meanwhile carries on, completely impervious to entreaties from any quarters save the presidency.

    That is where informed interjections by individuals like Sanusi ought to have made the difference. The kind of difference expected obviously goes beyond the wild and generalised claims about the shady activities going on. Which explains the pain when he blew the chance!

    Shouldn’t Sanusi, for instance, have known that only 24 percent of the revenue in question goes through the NNPC to the federation account?

    Was it deliberate – or is it simply a case of ignorance – that Sanusi did not bother to fit the payment by the NNPC into the remittance by other agencies in the oil sector to see how they fit into the matrix of the oil industry accounting before forming his conclusion about the scale of theft?

    And then to imagine in another breadth that the same Sanusi would actually seek – through the letter – to prod the President to act on recommendations whose premises are patently flawed?

    Clearly, the mere suggestion that the nation’s number one banker is ignorant of this elementary dictate of the oil sector accounting – something that goes to the heart of how the accruals are determined – must be considered as deeply troubling. Or is there something in the structure of the industry that prevents the government banker from knowing what is going on?

    Considering that he has barely six months left of his tenure, it may well be Sanusi’s valedictory letter. No doubt, the letter has done some good. For one, it should rest the controversies surrounding the $49 billion un-remitted funds. Moreover, if it is any consolation, the nation is at least spared the wild goose chase that leads to nowhere. At least, we now know that the custodial agencies responsible for remitting the balance into the federation account are the DPR and the FIRS. There should be ample time to chase the $10 or is it the $12 billion yet to be reconciled. One other good is that is to make the demand for a thorough overhaul of the corporation, urgent.

    On a final note, the twist in the NNPC under-remittance tale should cause a reflection on the Sanusi odyssey at the apex bank even as the debate on the character of his successor ramps up. While I do not belong to the lynch mob that would describe Sanusi’s tenure as a disaster, a lot can be said about his temperament, his judgment calls, not least his frequent outspokenness on just about anything that calls into question the wisdom of those who drafted him into the top job five years ago. While I may agree that a case can be made for activists like Sanusi in public service, it is hardly in the conservative chamber of the apex bank where a minor slip can sent the financial markets reeling. It shouldn’t be too early to wish Dan-Majen Kano luck in his next assignment. Considering his relatively young age, he would need it in the years ahead.

     

    Merry Christmas to my readers

    To those of you my readers who have kept faith with this page without fail in the past years, here is my simple prayer for you at Christmas: You will witness many more Christmas in good health and prosperity. The year 2014 and beyond will be better for you and all that is yours. Once again, Merry Christmas!

  • Public officers and foreign accounts

    The National Assembly (NASS) is in the process of approving and legalising ownership of foreign accounts by Nigerians or more appropriately, for themselves. The concern is that in whose interest are the legislators working? Everyone knows that most of them already own properties abroad apart from heavy bank accounts, when in actual fact they earn naira for the job they perform. Whenever they travel abroad officially, there are approved processes of getting them the required foreign currency to make payments for day-to-day transactions they might engage in.

    Those that deserve to own foreign currency accounts are business enterprises that deal with importation of goods and need to pay in the exporters’ local currency. The other are Nigerians employed or engaged to work in the foreign lands and have to live and spend the money in the country where they live. As soon as they are returning home permanently, they close such accounts. The third refers to consultants in Nigeria that are engaged by foreign firms or organisations and have to be paid in foreign currency of the contract country. The first two groups have the right to open foreign account in foreign land where they reside or transact businesses while the third group can only open domiciliary accounts at home i.e. in Nigerian banks. The third group eventually will withdraw the foreign currency, change it to naira to facilitate necessary transactions, except if the consultant has to pay foreigners working with them on the project and wish to take their shares in foreign currency. Even at that, there must have been initial agreement because nobody has the right to be paid in foreign currency in Nigeria but in naira. So, which of these groups do our legislators belong? Or where do they earn foreign currency to require such account?

    The world is now a global village and the banking system integration is not left out. Except for some banana’ countries which are yet to be connected, if you are holding an ATM card of any Nigerian bank with Visa or Master Card, you are already a global citizen and can collect money anywhere in the world. With such card, you can collect dollars in the United States, pound sterling in Britain and euro in any of the European countries, and so on. Even with your ECOBANK valve card you can collect local currency of any country where the bank has a branch. All that one needs is to load the ATM card with naira and move on to the destination abroad.

    These days, every country tries to protect the value of her domestic currency. For example, if you are a retiree from Britain and you are back at home, your pension will be paid to you in naira which is facilitated by the British embassy or outfits in Nigeria. Few years back, such pensioner was paid in pound sterling but in order to preserve the value of pound sterling the British financial managers have changed the arrangement. Realising that the embassy has lots of naira from large number of Nigerians paying for visa daily, it became necessary to take advantage of such to effect payments in naira. The same processes have been adopted by some other countries, as a way of reducing pressure on their domestic currency.

    I had an opportunity of using a United States’ fellowship along with some other Nigerians and we were advised by those we met on ground not to take a leave to Nigeria for complete four weeks starting from first day to the last day of a month. The reason was that we would not be paid our fellowship allowance for that month. The rationale is simple in that such allowance would not be spent in America and would therefore have no multiplier effects on the American economy but on the ‘other’ economy. Every dollar spent on American soil generates outputs in multiples just as every naira spent in Nigeria would do. So, these advanced countries do not play with the issue of multiplier effects of spending!

    Those who take our money abroad, either raw to be changed later or changed to foreign currency from bureau-de-change or black market are not patriotic, as such money generates no output or income and employment here while it does in the receiving country. In fact, when you change your currency to other country’s currency, you put pressure on your local currency. If the amount being exchanged is huge over time, the local currency will depreciate against the foreign currency and by extension, depreciate against other major currencies in the world. So every time your currency depreciates, you will need more of it to purchase the same quantity of goods.

    This means, if you are stealing the money, you will have to steal more money every time to buy more dollars or pound sterling, putting further pressures on your currency. The resultant effect is for the monetary authority in your country to draw down on its reserve to prevent the value of the local currency from depreciating. That exactly is what has been happening to the Central Bank that has continuously drawn down on foreign reserve to maintain naira level against foreign currencies. Our legislators have shown concern about the dwindling foreign reserve whereas they are part of the problems.

    Legalizing ownership of foreign account as is being proposed is like legalizing stealing, corruption and capital flight. It will not augur well for the Nigerian economy. The naira will depreciate; the foreign reserve will not grow but fall and affect the price of imports of raw materials which will go up thereby compounding the woes of the manufacturing sector which is already in precarious situation. Patriotic citizens would not work against their countries but try to protect it.

    Recently, I read in the papers how counterparts of Nigerian National Petroleum Corporation (NNPC) in other oil exporting countries used part of their incomes or earnings in portfolio and direct investments abroad to earn more foreign exchange and own property on behalf of their countries. Instead of such investment by NNPC, we hear of accumulated debt and Nigerian officials in NNPC and other such agencies owning lots of property abroad! So, we can know that when people in government, legislature and those in corridors of power (the dealers and wheelers) are talking of patriotism, it is all about self-protection; patriotism of the pocket.

    There are many important bills before National Assembly (NASS) that will help in re-building Nigeria’s battered economy and image than to be engaged in self-destruction. There should be bills on empowerment and employment of youths and women, infrastructural development, electricity re-distribution and generation, improvement in education and health sectors of the economy, et cetera. These are what should be of national concern to NASS not matters of personal aggrandizement. How can they be leaders in a country where, in 21st century, people still fetch firewood for cooking, drink water from ponds or streams, defecate in bushes, urinate on road sides, carry buckets looking for drinking water in big cities, students sit on floor or makeshift materials to listen to lectures, science students inability to identify common chemistry or physics equipment, and so on and so forth? The need to change our attitude for the good of our country has now become imperative, if we want our children to have a country that they can call their own.

    • Tella, is Professor of Economics at the Olabisi Onabanjo University, Ago-Iwoye

  • Cry my beloved country

    Cry my beloved country

    Events of the past couple of weeks in the polity tend to suggest that our dear country Nigeria is closer to the brink than initially thought.

    You all have read by now the infamous open letter of former president Olusegun Obasanjo to his god son and Nigeria’s incumbent president Goodluck Ebele Jonathan on his perception of the state of our nation.

    You must have read or heard also of a secret letter (leaked to the public) to the president by the Governor of the Central Bank of Nigeria, Sanusi Lamido Sanusi alleging that a whooping 49 billion USD or thereabout of earnings from oil, our major source of revenue, has not been properly accounted for by the Nigerian National Petroleum Corporation, NNPC. I don’t want to use the word missing to describe the state of the money as some were inclined to do. You know Sanusi has somehow recanted after a tug of war on figures so to speak with Finance Minister Okonjo-Iweala that the figure is somewhere closer to 10 billion USD.

    The two letters, both on the state of the nation have eventually drawn President Jonathan to his laptop to finally, or is it belatedly, pen a response and give us his own version of the state of our union. All the letters are in public domain, you are at liberty to chose which one to believe.

    In the midst of all these letter writings and dancing naked in the public by our leaders, I had cause to pass through one of our airports and while awaiting my flight to Lagos a certain Asian gentleman, I think he is Indian, was lamenting the state of affairs in this country, saying he has been here since 1983 and has never seen a country go down so quickly the way Nigeria is sliding currently. He wished we could as a nation and people do something urgently to arrest the situation.

    He was not even talking of the political situation (may be he was only being careful as a foreigner), he was worried about what he saw around him right there at the airport, the nonchalance of airline/airport workers to the plight of passengers that were left stranded for hours without explanation by the airlines; the deteriorating state of the airport, poor facilities even after billions of public funds have allegedly been spent to improve; the bare faced corruption going on there, and etc.

    The way he was saying all those things you’ll know he was saying them to effect, passing a message across, perhaps just using the airport situation as a metaphor for the larger problem out there.

    As he spoke my mind went to the Obasanjo letter especially what he said on the state of corruption in Nigeria, the alleged training of snippers by the administration to kill some one thousand or so Nigerians on the Federal Governent watch list, the vindictiveness of the Jonathan presidency against real or perceived enemies, the government’s romance with criminals and a whole lot of allegations contained therein.

    If a foreigner could talk like this, I guessed he must have seen something we as Nigerians are not seeing or chose to ignore.

    After several hours of delay the aircraft finally arrived and we headed back to Lagos safely. But that Indian never left my mind even when I wanted to push him away. And just as I was succeeding in doing this the president’s letter came; his response to Obasanjo. Personally I wasn’t impressed and no apology for that. His supporters can say whatever they want to. I’ll come back to that later.

    I am not a fan of Obasanjo because he is not better than Jonathan. But what I found surprising in his letter was that all those bad things we complained about under Obasanjo are still happening even with Jonathan. Have we not learnt anything? What kind of a nation is this?

    Obasanjo complained about corruption all around Jonathan and GEJ apologists say his mouth is smelling. Yes his mouth might be smelling, but then let’s cover our nose and listen with our ears. Is corruption not at it’s peak now? And what is Jonathan doing about it?

    In his laughable response he wanted Obasanjo to show him one example of corruption in high places and see what he would do about it. Do you need an Obasanjo to tell you that what is happening in the aviation sector, especially the role of the seemingly untouchable Minister of Aviation Stella Oduah in the BMW bullet-proof car scandal is enough evidence of corruption or attempt to defraud the state? Recall that the Honourable Speaker of the House of Representatives Aminu Tambuwal did say something similar about corruption incorporated in the Villa and the President’s seemingly supportive body language? All Jonathan could say is that he is fighting corruption, but we have not seen the evidence yet, let him start with Stella Oduah, then we’ll know he is in business.

    The damage the ruling Peoples Democratic Party, PDP is doing to the polity with its on going civil war is incalculable and Jonathan as party leader appears incapable of doing anything to stop it. All he could say was to blame Obasanjo and a few others for orchestrating it. Our democracy is in crisis because PDP is in disarray. If there is no crack in the wall of PDP how can an Obasanjo’s lizard enter it? When people say Jonathan is weak, he lacks initiative, this is one of the things that are talking about. How can you open your eyes and allow a behemoth that the PDP had become to collapse on your head, knowing the implication for the country, and all you could do is to blame another person for it? Us this how to be a leader?

    I don’t want to believe Obasanjo’s pepper soup theory of government training a squad of snippers to assassinate government’s opponent, but as a former President and Commander-in-Chief may be he knows what he was talking about. May be we better listen to him. And all Jonathan needs to do to prove Obasanjo wrong is to ensure that no assassination, whether political or otherwise took place under his watch, and if it did take place, the perpetrators are swiftly brought to book. Sadly Obasanjo couldn’t say this for his eight years presidency.

    But in an atmosphere of insecurity, anything could happen, thus Obasanjo’s alarm on the deteriorating security situation in the country, especially in the north east zone should not be brushed aside. Yes the Jonathan government is doing its best to contain if not destroy the Boko Haram insurgency, but the rate of setbacks in recent months suggests either a lowering of guards by the security agencies or an insurgency smarter and better organised than our military. This is not the time to pontificate or lay blame, we should all rally round Jonathan to bring down Boko Haram and restore peace to the north east. The government should also not arrogate to itself the power of knowing it all. If a former Commander-in -Chief is talking about security, please listen to him, even if his mouth is smelling.

    Jonathan talks about the improving state of the economy and the increase in Foreign Direct Investment (FDI) flow into the country in contrast to the dire picture painted in Obanjo’s letter. I don’t know what the president was talking about. Economic growth without jobs? The president and his coordinating Minister of the Economy Okonjo-Iweala can be deceiving themselves thinking that all is well; Nigerians are no fools!

    There are so many issues raised in Obasanjo’s letter and the President’s tame response that space will not allow a thorough analysis, but one issue stands out; the President’s personal integrity and credibility. Obasanjo alleged that Jonathan is not a man of his words; sadly, he is not the first person to so allege. Most people around the corridor of power in Abuja will tell you the same thing. You can’t go to the bank with Jonathan’s words. There is even this joke that there are five presidencies in Jonathan presidency and of the five his own is the weakest.

    This could be uncharitable if you ask me, but at the same time most unfortunate if it is true. This is the public perception and the President must do something about it. After all perception they say is close to reality. If Nigerians believe their president is weak and not a man of his words then he can do no good in their eyes no matter how hard he tried.

    People point at his wife as one centre of power; his Chief of Staff, Ministers of Petroleum and Aviation as the other presidencies, and the President has not called them to other even for one day in the face of public complaint against them.

    The President may not see it as so, but these people together with his rabid Minister of Education Nyesom Wike and some of his Ijaw kinsmen are the ones giving him a bad name among Nigerians not Obasanjo. He should leave the former President alone; tackle his message and not the man. After all Iyabo Obasanjo is enough to tackle her father. May God not give us a daughter like Iyabo. Did I hear you say and a father like Olusegun Obasanjo? Na you sabi. I don talk my own.

  • CBN, NNPC ‘reconciling $10.8b’

    CBN, NNPC ‘reconciling $10.8b’

    Just how much is the shortfall of the cash that should have been sent to the Federation Account?

    The question remains as knotty as it was since Central Bank of Nigeria (CBN) Governor Sanusi Lamido Sanusi broke the news of a missing $48.9billion.

    “We will continue our work, until we can come to terms of what is actually the shortfall and what is due to come to the Federation Account,” Finance Minister Dr. Ngozi Okonjo-Iweala said yesterday in Abuja at a news conference.

    With the minister were Sanusi, Petroleum Resources Minister Mrs Diezani Allison-Madueke and Nigerian National Petroleum Corporation (NNPC) Group Managing Director Andrew Yakubu.

    Mrs. Okonjo-Iweala was speaking on the findings of a revenue reconciliation meeting convened among the CBN, NNPC, the Ministry of Finance and other stakeholders to clarify the discrepancy.

    Said the minister: “At the meeting, the NNPC noted that the actual proceeds from crude oil exports over the period amounted to US$67.12 billion, and was thus about US$1.79 billion higher than the revenues reported by the CBN (possibly due to timing differences and Nigerian Petroleum Development Company (NPDC) listings, which were not included in the CBN report).”

    According to the NNPC records, the Finance Minister said, the total revenue of US$67.12 billion comprised revenues which directly accrued to NNPC (for the Federation Account) of US$14 billion; and additional revenues lifted by NNPC on behalf of other parties as follows: for FIRS (US$15 billion), for DPR (US$2billion), for NPDC (US$6 billion) and for other third party financing (US$2 billion). In addition, domestic crude lifted by the NNPC amounted to about US$28 billion.

    This domestic crude component, she said, was not reflected in the CBN’s foreign accounts, but rather paid directly in naira into the Federation Account.

    As such, “taking account of these various exports conducted on behalf of the non-NNPC parties, the total of US$67 billion was mostly accounted for. This substantially addresses the issues raised by the CBN” she said.

    Mrs. Okonjo-Iweala added that “the Federation Account indicates that over the period January 2012 to July 2013, a shortfall of US$10.8 billion was recorded from the domestic crude oil receipts.” This shortfall she said, has been acknowledged by NNPC, but the magnitude of the shortfall is still disputed by NNPC.

    The shortfall is explained to be the result of subsidy claims, unrecovered crude/product losses, and cost of strategic petroleum storage (which is currently not captured in the Petroleum Product Pricing Regulatory Agency (PPPRA) template for refunds).

    This figure, she said, is also well-known to all stakeholders at the Federation Account Allocation Committee (FAAC), and is reported and updated monthly.

    “However, all parties concerned are working assiduously through the ongoing reconciliation efforts to resolve this. Both Finance and NNPC have been in discussions to reconcile; we do so every month after Federation Account Allocation Committee (FAAC) meeting we reconcile our figures, it is not an easy thing,” Mrs Okonjo-Iweala said.

    She added: “In the course of the reconciliation, from January 2012 to July 2013, we have looked at a shortfall of about N1.7trillion, the equivalent of $10.8billion. That is the amount that we have been discussing and, of course, NNPC has been disputing some of it. But it is an ongoing reconciliation. We will still continue; we do it every month.”

    A statement released to the media to capture the efforts to trace the “missing” fund noted that “as a result of the changing structure of the business arrangements- from joint ventures to production sharing contracts, alternative financing arrangements, and the impact of the fiscal regime on gas development- the government, take in recent years has been declining. In this regard, a quick passage of the Petroleum Industry Bill (PIB) will help to reverse this trend.”

    Sanusi said what the CBN had in its records was $65billion shipped by NNPC and about $15billion returned as equity to the Federation Account, but after his letter to the President, it was discovered that “out of the $65billion that NNPC shipped, $24billion did not belong to NNPC; it was crude that was paid by oil companies as tax and royalties and shipment for them from NPDC and so on. So that explains half of the sum. Now the outstanding issues are with the $28billion domestic crude, which has been taken by NNPC. From our records, we have received $16billion. There is a shortfall of $12billion and we are told that that shortfall has always been a part of an ongoing discussion with ministries of Finance and Petroleum and NNPC. So this is where we are. Finance, NNPC; all parties are going to try to resolve this matter.”

    Sanusi said: “The CBN has a duty to perform and if we see anything that should worry government, we alert and that is what we have done. We have alerted and this has been investigated, and looked at and this is the conclusion, the letter was not the end of the investigation.”

    Mrs Allison-Madueke said to mitigate and minimise the incidence of crude theft, the government has extended an “invitation to the United States to partner and assist us in this, particularly the international dimensions of this crude theft”.

    “We are in on going discussions with them; we met with a cross sectional team of intelligence experts last week and we had very crucial discussions that cut across many areas of the business,” she said.

  • NNPC seeks review of tribunal’s ruling

    NNPC seeks review of tribunal’s ruling

    The Nigerian National Petroleum Corporation (NNPC) has urged the Federal High Court in Lagos to review a ruling by the Tax Appeal Tribunal (TAT), Lagos Zone, on a dispute over an oil mining lease (OML) 118 Production Sharing Contract (PSC).

    It said the tribunal wrongly assumed jurisdiction in the dispute.

    Parties involved are the Federal Inland Revenue Service (FIRS), Shell Nigeria Exploration and Production Company Limited (SNEPCo), Esso Exploration and Production Nigeria (Deep Water) Limited, Nigerian Agip Exploration Limited and Total E & P Nigeria Limited, joined as second to sixth respondents.

    NNPC sought a declaration that TAT, Lagos Zone (the first respondent) lacked the competence or jurisdiction to entertain or adjudicate over rights and obligations conferred on parties to the Bonga PSC.

    It said the tribunal cannot determine contractual disputes arising from the different interpretation of the various parties to the contract.

    Shell, Esso, Agip and Total had sought declaratory reliefs at the tribunal over the determination of tax incidences of parties in PSC involving NNPC.

    The tribunal, in its July 3 ruling, assumed jurisdiction in the case. It held: “The tax assessment challenged in this appeal is within the remit of the Tax Appeal Tribunal.”

    But NNPC urged the Federal High Court, presided over by Justice Mohammed Idris, to declare that the tribunal’s decision “ultra vires, illegal, wrongful, null and void and of no effect whatsoever.”

    It sought an order of certiorari (order given by a superior court), urging the court to take over the tribunal’s proceedings, determinations and directives and to quash them, as well as the ruling.

    NNPC prayed the court to make an order prohibiting TAT, Lagos Zone from further hearing and making any interim or final decision in the case of Shell Nigeria Exploration & Production Company Limited and others vs, FIRS and another, numbered TAT/LZ,001/2012, among others.

    It sought an order of perpetual injunction restraining the tribunal (first respondent) from adjudicating on the declaratory reliefs sought by the third to sixth respondents.

    NNPC said the tribunal erred when it assumed the powers ordinarily conferred by Section 251 of the 1999 Constitution on the Federal High Court to entertain and determine matters relating to government revenue.

    It claimed that by the provisions of the OML 118 (Bonga) PSC, the third, fourth, fifth and sixth respondents are not tax payers known to the FIRS and as such are unable to successfully maintain an action before the tribunal against FIRS.

    NNPC added that the reliefs before the tribunal is such that when determined, will have direct impact on Federal Government’s revenue and the contractual relationship in Bonga contract.

    NNPC, the concession owner and holder of Oil Prospecting Licence (OPL) 212, executed the Bonga PSC dated April 19, 1993, with Shell as contractor to the operations of OPL 212.

    Shell, Esso, Agip and Total constitute the “contractor” apparently through a joint venture in the Bonga contract, which sets out parties’ rights and obligations.

    By the contract’s provisions, NNPC files Petroleum Profit Tax (PPT) returns on behalf of itself and the contractor.

    According to NNPC, the contractor was to prepare accurate PPT returns and submit to the corporation, which in turn files the returns to FIRS.

    The applicant said in 2010, Shell and others prepared “incorrect” PPT returns for 2009 assessment in respect of Bonga license and forwarded same to the NNPC.

    NNPC alleged that the returns it received from the contractor was “inaccurate, incorrect and non-compliant with contractual terms of the PSC.”

    It claimed it was compelled to file accurate tax returns with FIRS, which resulted in a disagreement with the contractor.

    Subsequently, the oil firms instituted an appeal at the tribunal.

    They sought “a declaration that although chargeable tax for the year is USD2,042, 706, 851, however, by virtue of the overpayment of PPT in previous years of assessment, the PPT for the Bonga Contract Area in the 2010 year of assessment is nil.”

  • Refineries: PENGASSAN, NUPENG threaten strike

    Refineries: PENGASSAN, NUPENG threaten strike

    The Petroleum and Natural Gas Senior Staff Association (PENGASSAN), yesterday said it will call its members out on a strike should the government decide to proceed with its plan to privatise the refineries.

    PENGASSAN President Babatunde Ogun said the association will commence the strike in January.

    He said sister union National Union of Petroleum and Natural Gas Workers (NUPENG) will join in the strike.

    Ogun told members of the the association at the headquarters of the Nigerian National Petroleum Corporation, NNPC, in Abuja, that the planned privatisation is an attempt to hand over the nation’s refineries to cronies of the Federal Government.

    He said that an indefinite strike will be declared in the first week of January 2014, to press home their demand on the Federal Government not to sell the nation’s refineries in the name of privatization.

    “If between now and 24th of this month (December), government does not retract that every statement that has been made has been put on hold while further engagement is made, and everything we have to do is hinged on PIB (Petroleum Industry Bill) by first week of January, be rest assured that PENGASSAN and NUPENG will go on indefinite strike.

    “You cannot sell something without a model, without Nigerians knowing exactly what you are doing…the nature in which they do business in the oil and gas industry is fraught with secrecy. There must be a retraction first and it’s what they will make public, so Nigerians will know that it is on hold,” he said.

  • Before it is too late?

    Before it is too late?

    Hate him or love him, there is something about the Olusegun Obasanjo persona that manages to evoke mixed passions both in the polity and in every one of us. A classic study in ethical and moral abdication, his story, emblematises the ugly face of the nation’s leadership regression. For a man whose entire public life had the ever tending hands of benevolent gods doing the cracking of his proverbial palm kernels for him, those who endlessly accuse him of opportunism merely acknowledge the gracelessness that has dogged his entire life.

    So much for the naked dance of the self-appointed diviner of fate!

    The issue of course is the ex-President’s inelegantly worded 18-page ‘advisory’ to the estranged godson dated December 2 – that is few days before the December 5 passing of the great Nelson Mandela. Although it seems highly improbable that the timing of its ‘leakage’ had anything to do with an attempt to burnish the shrunken stature of a man who once rubbed shoulders with global statesmen as a member of Commonwealth Eminent Persons Group, even at that, there are those who would swear that Obasanjo actually chose the timing of the release of the ‘satanic verses’ as his own revenge on a world that has long expunged his name from its roll of statesmen!

    I must say that one of the difficult, unenviable choices of being a Nigerian is being called upon to pick between the graceless, unforgiving, hypocritical and the outright lawless godfather and his utterly incompetent, vacillating and corrupt clone!

    I have been asked the question nearly a dozen times – what do I make of Obasanjo’s letter to President Goodluck Jonathan?

    My ready answer is –it is vintage Obasanjo with its signature self-serving patriotic pretensions and alarming prognostications. Simply because he created Jonathan in his image and after his likeness, he seeks to remain the jealous god to whom the man must defer whether in the running of the party or the conduct of his government! It’s part of living in the illusion of being the ultimate shuttle diplomat – consulted by Presidents and kings – to do what he does best – dousing the fires created by the many marionettes on the continent!

    Such make-believe larger than life image of Obasanjo obviously plays to type. It is part of the myth woven round the man now pejoratively call Baba. Recently, I watched Baba spar with ex-CNN man, the Kenyan-born Jeff Koinage on You-Tube. I struggled to reconcile the image of a once celebrated professional with the practiced actor fawning before our own OBJ at some downtown conference in East Africa! And how the man loved the comical spectacle!

    Why is OBJ angry with GEJ? Is it for surpassing his administration’s records in serial abuses of our laws and institutions? And talk of fidelity to party; didn’t Obasanjo blaze the trail in party infidelity when he supported Ikedi Ohakim, the PPA candidate against Ararume, the candidate of his party? What about the serial impunities in Ekiti, Plateau and Bayelsa? And the corruption? The third term subversion, etc.

    Nigerians, it must be said truly know who their troubler-in-chief is.

    Now, let’s turn to the sanctimonious Jonathan presidency. I wish there was something left of that intangible called ‘sympathy’ for an administration that has done all in its power to mismanage virtually all aspects of our lives in a little over three years since it took charge. From a broad pan-Nigerian mandate of 2011, what we have now is a presidency diminished both in moral authority and in grandeur. In this, Obasanjo was neither original nor expressed anything outside what other Nigerians have come to perceive as the gracelessness of our Ijaw brothers in appropriating this Presidency as theirs. And how they rub it in!

    Under Obasanjo, at least you knew who was in charge; today what we have is a laissez faire presidency – a party of all comers. Imagine an administration presiding over the daily theft of 20 percent of its main revenue source – crude oil? It would hardly be uncharitable to qualify it as an administration only in name.

    In saner climes, that is a cause for war! What do we have instead? Brigands calling the shots leaving state actors to squabble over the dregs in the pot. And this is supposed to be a country with a standing army, navy and air force. Welcome to GEJ’s gangland republic.

    That was what Obasanjo inferred with his allegory of the thief being invited to guard the house. Only the presidency can afford to pretend not to know who the thieves are; or the house being ravaged. We know. We know what the supposed minders have done with our lives. It’s etched on the faces of the ordinary man on the Main Street.

    It is of course that graft in high places of course stinks to high heavens. The scale of impunity beggars believe. Ever heard of corruption-complaint administration? There is putrefaction everywhere; the NNPC is an island unto itself; or so it has always been. The accounts, we are told by those who should know, are for their eyes only. Only in Nigeria would the variation on existing contract quadruple the initial contract sum. If in doubt, ask Works Ministry; the smart operators in the powerful ministry have just enough tools to convince, confuse and confound anyone!

    I need to talk about the little matter of the aviation ministry. Yes, Stella Oduah of the Stellagate fame is still in charge. You ask; how come? Our President of course thinks corruption is overblown; that it is more of a perception thing.

    Now, we have since learnt how easy it is to purchase two bullet-proof vehicles outside the strictures of appropriation process in clear violation of the procurement laws; that is of course permissible so long as you have the ears of the President. Never mind that those who should approve the expenditure have long denied that they gave no approval for anything of the sort. With the chief of state settling for an administrative panel rather than haul the alleged felons before the courts, the case appears closed.

    I don’t think Nigerians can suffer the indulgence of ignoring Saint Obasanjo. That would be fatal. An erstwhile commander-in-chief obviously knows the implication of raising hell over the 1000 names said to be on political watch list and an alleged recruitment of hit squads for whatever agenda. It goes beyond wishing that the worst would not happen. It calls for action on the part of the National Assembly as the elected representatives of the people. As the Yorubas would say – the log that poses a threat to the eye is better taken off from a safe distance. Hardly a time to cast lots between godfather and godson.

  • So long a letter

    So long a letter

    The Senegalese, Mariama Ba (1929-1981), wrote So Long A Letter, a semi-autobiographical novella, that chronicled the plight of the African woman, under the combined pressure of African and Islamic cultures.

    The male chauvinists that dominate both worlds would scoff at the late Madame Ba’s “ranting” against the marital status quo, so violently skewed against the woman in both cultures. But her 1980 classic has provided gender rights activists, determined to right these age-old wrongs, an evocative literary tool.

    On December 12, former President Olusegun Obasanjo made public his own long letter, not for any overriding public good, but a litany of woes against his estranged protégé, President Goodluck Jonathan. Obasanjo played his usual grandstand as some self-appointed overseer of Nigeria; and postured without end as the all-consuming patriot.

    Yet, it was nothing but another unabashed glorification of the Obasanjo self — that ever intrusive persona that, on the balance of fair evidence, can’t even pass the muster of the model citizen.

    Like most of Obasanjo’s hyper-reported public interventions, it was another grand show of a show-actor craving a stage and cheap applause — cynical applause at the expense of some political foe. The former military head of state (1976-1979), two-term elected president (1999-2007) and fundament of the Nigerian problem is crying wolf!

    Yes, there is indeed some “wolf”. But Obasanjo himself was its author and finisher: Goodluck Jonathan, after all, was Obasanjo’s political creation. But the creator would rather Jonathan was some tabula rasa — on which he could write and erase at will — which the protégé has resisted.

    Godson cannot, therefore, hear the godfather. Things have fallen apart, so mere anarchy, to paraphrase the Irish poet, William Butler Yeats, is loosed upon their once cosy world! But how is that a problem of Nigeria and Nigerians as Obasanjo now trumpets?

    Indeed, Yeats in his poem, “The Second Coming”, somewhat echoes the loud but empty Obasanjo interventions: “The best lack all convictions, while the worst are full of passionate intensity!”

    That brings the discourse to Obasanjo’s “permission” to share the Jonathan letter with the quad of Generals Theophilus Danjuma, Ibrahim Babangida, Abdulsalami Abubakar and 2nd Republic Vice President, Alex Ekwueme — to earn some high profile sympathy? Ah!

    But which of these, aside from Abubakar, has not tasted Obasanjo’s rather crude tongue, in his endless playing to the gallery?

    Is it Danjuma who, not long ago in a fit of media anger, dismissed Obasanjo as “Aremu of Ota”?

    Or Babangida, who earlier as self-proclaimed “military president”, endured the Jonathan treatment, the same grand hypocrisy the grim Sani Abacha could not stand and, before the infernal theatrics started, despatched the grand dramatist to gaol on phantom coup charges?

    Or is it Ekwueme that Obasanjo muscled into silence while, as president, he started destroying the Peoples Democratic Party (PDP), the logical conclusion of which he now, ironically, accuses and ridicules the luckless Jonathan, though his name be Goodluck?

    If Jonathan has his Bamanga Tukur, didn’t Obasanjo have his own Garrison Commander, Ahmadu Ali, both relentless presidential puppets that smashed the ruling party so a bully president could stand tall, like some Gulliver in Lilliput?

    Yet, no tears for President Jonathan. He plunged his knife into a dead hippo, fallen by the pool; and he richly deserves his running diarrhoea. There is always a stiff price for crass opportunism!

    Besides, despite being the first Nigerian president to bear the academic prefix of PhD, Jonathan’s actions have no rigour, no grace, no gravitas, just plain humdrum! Indeed, by his actions and inactions he has, perhaps more than any other, afflicted his presidency with a rare pull him down (PHD) complex.

    His is a grand study in wilful conspiracy against self; and the resultant harsh wages of promotion beyond competence. His presidency is therefore a grand let-down, right from the beginning — and there appears no redeeming factor.

    Indeed, as one contemplates the Jonathan Presidency, with its welter of terrible constitutional infractions and heinous allegations, and the man at the vortex of it all feigning none the wiser, the disturbing image of the Biblical wolf in sheep’s skin floods the mind.

    But even as the president sweats under the crushing weight of his elephantine troubles, his feet, in fatal distraction, appear still foraging for needless troubles with ants.

    The induced Rivers crisis is an abiding case in point, with the Police not even hiding their hideous partisanship; and rogue legislators, backed by rogue “federal might”, threatening to plunge that state into anarchy.

    Then there are opposition allegations of Jonathan turning the Ecological Fund into some crony gravy — allegedly rewarding friends, punishing foes.

    Of course, there is also the abiding allegation, supported by CBN Governor, Sanusi Lamido Sanusi, that the Nigerian National Petroleum Corporation (NNPC) is undercutting the country and the president doesn’t appear to have a clue about it all.

    That these allegations are made at all show the near-hopeless depth the Nigerian presidency has plumbed under Jonathan. That is unfortunate. But even more grievous is Obasanjo’s allegation that Jonathan is arming snipers to despatch political foes.

    Though the now crusading Obasanjo had more than a fair share of unresolved politically motivated killings during his presidency, this is one allegation Jonathan must deal with, if only to clear his presidency’s sagging reputation.

    But aside from this alleged killer squad, most of Obasanjo’s charges, in his long epistle of lamentation, were pure gas. There was nothing Obasanjo accused Jonathan of that he himself did not do during his best-forgotten presidency.

    NNPC is opaque. But how open was it during Obasanjo’s term, even when he was his own oil minister?

    On corruption — what has Obasanjo to teach, after his Obasanjo Presidential Library’s bared-faced extortion? If Jonathan responded with a contractor building his village a marvel of a church, it is evidence that Jonathan is master of his political father’s rotten tactics, corruption be damned!

    Jonathan wants to run for second term — and so what? Didn’t Obasanjo do two legal terms and was plotting an illegal third? Fortunately, Jonathan is doing more than enough to be guillotined at the polls. So, let the people decide his fate.

    Therefore, to now grandstand at some ogre, hinting at some non-democratic change, under some pseudo-messianic complex, is not only cheap but outright subversive. But it is another cynical drama, for Obasanjo knows that he too would vanish without trace, should Jonathan meet his electoral waterloo. So, would his and Jonathan’s credo of power without responsibility; and lollies without service.

    Obasanjo and Jonathan are an inglorious past and ignoble present that must be electorally swept away, from polluting the future. The Ebora Owu’s long letter of tumbling adjectives, and buzz words like honour and credibility that, from Obasanjo’s own conduct in office hardly meant anything, is his way of buying time and shopping for new puppets.

    He fails — except, of course, with the gullible and the excitable!

  • $49.8b ‘missing’ oil cash: NNPC, CBN, others meet tomorrow

    •NNPC confirms generation of $67.12b , remittance of $18.48billion from January to July

    WORRIED by the tension generated by the allegation of missing $49.8billion oil money, the Nigerian National Petroleum Corporation(NNPC), Central Bank of Nigeria (CBN), Federal Inland Revenue Service (FIRS) and the Directorate of Petroleum Resources are due to meet tomorrow in Abuja to reconcile their accounts and records on the oil proceeds.

    The session will be monitored by officials of the Federal Ministry of Finance and the Budget Office.

    Speaking yesterday ahead of tomorrow’s meeting, the Group Executive Director (Exploration and Production) of NNPC, Abiye Membere, said that the corporation actually generated $67.12billion between January and July this year.

    Of this amount, the NNPC, according to him, remitted $18.48billion into the Federation Account.

    This, he said, was “in line with its mandate to deliver profit oil.”

    Membere, who spoke at a technical briefing of journalists in Abuja, said it was left to the CBN to tell Nigerians what other stakeholders like the DPR, FIRS remit into the Federation Account.

    He explained that the NNPC pays proceeds from Equity Crude directly to the Federation Account while the CBN, the FIRS and DPR pay Petroleum Profit Tax and Royalty into the Federation Account.

    He said the CBN should tell the public if the FIRS and the DPR made zero payment into the Federation Account within the same period under review.

    He said: “The current concern is between the CBN and NNPC. The CBN is claiming that $49.8billion is missing but we are going to meet by Monday or Tuesday to reconcile our records and accounts because payment for crude is done through letters of credit, it is not something you carry cash about.

    “The Monday session will involve NNPC, CBN, FIRS and DPR among others like the Ministry of Finance and the Budget Office.

    “On the CBN allegation, it is not yet a right or wrong allegation. If the $49.8billion is missing, we will sit to check records and ask where that money is. There is no bank in the world where you put $50billion and international creditors will not raise alarm. The issue is sitting together to reconcile all records. Maybe somebody must have overlooked certain things.”

    Responding to a question, Membere said: “If $50billion was not paid into the Federation Account, was this noticed within one month. How come the CBN did not alert NNPC or the Federal Ministry of Finance until now?

    “We did not know how the letter emanated because we meet on monthly basis and the Federation Account Allocation Committee meets monthly too. So, the records are there for all to examine. We will know the truth or otherwise when we meet on Monday.”

    On the figures used by the CBN Governor to arrive at its claim, Membere said: “He collated his figures from the National Export Supervisory Scheme and the Trade and Investment Department of the CBN.

    “But if there is any agency to manage the data pool, it is only the Directorate of Petroleum Resources because it supervises everybody in the oil industry.”

    Asked of how much the NNPC generated and what it remitted into the Federation Account, GED Membere added: “The total revenue generated from January to July was $67.12billion but based on the CBN Governor Lamido Sanusi’s figure, it was $65.33billion.

    “Of this amount, NNPC’s mandate is to deliver profit oil, which is $18.48billion. We have paid $18.48billion into the Federation Account.

    “What we have, as NNPC , is production target and it translates to certain amount on monthly basis.

    “We have a production target of 2.48million barrels per day but we are only meeting between 2.26m and 2.27m barrels per day because of the pipeline vandalisation and the environmental situation. No oil company will work as soon as you see a leak.”

  • Sanusi playing politics with $49.8b claim – NNPC

    Sanusi playing politics with $49.8b claim – NNPC

    The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Engr. Andrew Yakubu, on Friday described the Central Bank of Nigeria (CBN) Governor, Mallam Sanusi Lamido Sanusi’s claim that the corporation failed to remit $49.8 billion into the Federation Account from January 2012 to July 2013 as a “political instrument for the 2015 general elections.”

    Yakubu, who spoke at a world press conference at Abuja, said it is a baseless and unfounded allegation targeted at ridiculing the management of the NNPC.

    He said: “In conclusion, I want to say from what I have said clearly that the allegation is unfounded. It is baseless and it has become a political instrument in the current politically charged environment. And we consider this as an attempt to ridicule the corporation and its management.”

    Asked to explain what he meant by political instrument, the NNPC boss added, “So, I am taken aback that this issue that came up about four months ago, we made our clarification to the Hon. Minister of Petroleum Resources four months ago and for it to surface at this time that the political atmosphere is charged, then we find it difficult. We are taken aback, then it is left for you journalists to do your investigative journalism to unravel the reason behind this attack.”

    Yakubu, however, explained that NNPC crude oil lifting include equity crude, royalty oil, tax oil, volume for third party financing and Nigeria Petroleum Development Company equity volume.