Tag: NNPC

  • Endless probe on NNPC

    My guess is like yours when I read a recent report that the Senate is to probe the Nigerian National Petroleum Corporation, the NNPC.I can’t tell the outcome of the Senate probe this time but like many probes conducted by the National Assembly I don’t have much anxiety at all. Thirty-Seven years ago I was anxious about such a probe. On December 12 1979 I covered the sitting of the House of Representatives and a motion was brought by Mr Dagogo Princewill(Degema) and Mr. Fola Omidiji (Egba Alake Constituency) to probe the NNPC. Following a report that certain money was stolen in the Corporation.

    The Speaker of the House then, Chief Edwin Ume-Ezeoke(1935-2011) from Nnewi in the present Anambra state ruled both of them out of order. He then asked the two members to bring a substantive motion for deliberations.

    On January 15 1980, Prince Dagogo Princewill brought a fresh motion to probe the NNPC. He said “My enquiry has revealed, Sir, that in this Company there are no adequate personnel especially in the field of accounting and internal audit. I understand too, Sir, that people are being scared away for one reason or the other because they do not come from a particular part of this great country and too, Sir, because they do not belong, or because they were not ex-students of a particular institution. As a result of this, Sir, well qualified people left their jobs in this Corporation. I am told,Sir, that one Mallam M.Y. Wanka,from Bauchi State, a qualified Chartered Accountant, was the only one in the Audit Department. He was frustrated, and he had to leave, and today, he is in the Nigerian National Supply Company as a Representative/Agent in their London Office. Even as at today, Sir, there are only four qualified Chartered Accountants in that Company.

    Mr Speaker, Sir, members of the profession of which I am one are very difficult to get—I mean the Chartered Accountants. A Corporation of the magnitude of the NNPC should have gone to the Nigerian labour market and tried its best to get these people. Instead of that, Sir, there are only four Accountants, two in the audit department and two in the main accounts department. Fo a Corporation of this magnitude, this is grossly inadequate. The four Chartered Accountants are not even sufficient in one department not to talk of the whole Corporation. A Corporation of this standard should get at least twenty Chartered Accountants. I am also told that the service condition is very bad in this Corporation, and the service condition has mae good people to run away from this Corporation.

    Now, Sir, the audit report as given by an internationally recognized and reputable firm of Chartered Accountants, disclosed that they were unable to confirm or find any justifiable reason for the misappropriation of N2.8billion. This is very serious. In this country, we are told that the Press is the watchdog of the nation. During the Army regime it was very difficult, if not impossible, to investigate this matter. Now it is falling on our shoulders to do this onerous task. I would like to commend the Punch Group of newspapers who were able to tell us what was happening in this Corporation, but they were unable to investigate further what had happened to N2.8billion. Either as a result of inefficiency or misappropriation, this amount is unaccounted for”.

    Other members who contributed to the debate were Mr. O. Akinboro)Oke-Ona/Owu/Gbaguar), Mr. M.O. Ugwu(Udi), Dr. E.J. Sowho(Ethiope North), Mr Debo Akande(Ibadan North), Mr Gbadebo Adewumi(Osogbo South), Professor Opayemi Ola(Ekiti West), Mr Abubakar Audu(Anpa South), Prince Awa Ekpo(Eket II), Mr. Charles Adigwe(Awka), Mr E.D.N. Nwandu(Mbaitoli), Alhaji Sanda Kunduga(Kunduga), Dr Junaid Mohammed(Kano West Ward) and the leader of the House then, Alhaji Yinusa Kaltungo(Tangale-Waja South).

    At the end of the day the House set up a Committee to probe the NNPC.  Alhaji Yinusa Kaltungo declared”the motion standing in my name read: That in accordance with House Resolution 48 of 15th, 1980 the Special Committee on the Nigerian National Petroleum Corporation should be made up of 15 Members to be composed as follows: 6 Members of the NPN, 4 Members of the UPN, 3 Members of the NPP, 1 Member of the PRP and 1 Member of the GNPP. The Motion was seconded by Mr Jimoh Damisa(Adabbi/Okehi).

    After the motion, two members spoke again. They are Mallam Sidi Ali(Dambata) and  Dr Junaid Mohammed(Kano West Ward).

    Dr Junaid declared,”Another thing is that we have to subpoena the Council Memo which was written and submitted to the Council asking for a transformation of the NNOC into the NNPC. These are very vital documents and vital personalities. Another person will be the former Chief Internal Auditor who has resigned and is now in Britain as the Representatives of the Nigeria National Supply Company. We have got to summon some of these people. It is absolutely important, Sir, that you co-opt more people as the Speaker of this House in order to make this Committee’s work succeed, otherwise, we are up against a very powerful clique. The Senate has been sitting on the Bill sent by the President to discuss and re-organise the NNPC. This gives us room for enormous suspicion and I think it is absolutely important we know the enormity of the task before us so that we do not deceive ourselves. Mr. Speaker, Sir, we may find that the Committee with all its intentions may be a worthless exercise. I want to add that we it with all seriousness”.

    On February 4 1980 the committee was inaugurated by Chief Ezeoke and it was headed by my friend, Dr. James Taribo Sekibo(1939-2013) (Bonny II))  who later became the Odo-Abaji of Canoe House in Okrika, Rivers State.

    On March 31 1980, Chief Ezeoke told the House that “I think I would seize this opportunity to congratulate ourselves for the progress we have made so far in respect of the investigation of the missing N2.8 billion in the NNPC. (Applause) Following the events of the last week and the newspaper publications, the stand of this House in respect of the misappropriation of N2.8 billion by whoever it might be in this country, has now been fully justified. (Applause) I will maintain that the investigation must continue. We must satisfy the aspirations of the people who elected us into this august Assembly. I must maintain that we must not be a successful victim of any blackmail, any subversion, and any attempt by inside and outside sources to impede sources to impede the continuation of this investigation. This money, in whatever account it may be anywhere in the world, must be recovered and brought back to this country.(Applause)

    As soon as we conclude our investigations, the appropriate committee will introduce a legislation to enable the repatriation of this money, and to ensure that the people involved are adequately punished. Accordingly, the special Committee on NNPC will meet in my office immediately after today’s meeting”.

    Sadly, that was the last we heard about Dr Sekibo’s Committee and the report of the Committee. On December 31, 1983, the Military headed by Major General Muhammadu Buhari took over power.

    Here, we go again.

     

    • Eric Teniola, a former director at the presidency stays in Lagos.
  • Pressure on Senate panel to drop $25b contracts probe

    The Senate Ad Hoc Committee probing the “$25billion transactions” by the Nigerian National Petroleum Corporation (NNPC) is under pressure to drop the enquiry, The Nation has learnt.

    Some prominent citizens have been asking committee Chairman Aliyu Wammako to either stay action on the probe or work towards a “soft-landing” investigation and report.

    Others, who are influential stakeholders in the oil and gas industry, have been lobbying the Senate leadership to suspend the probe in the light of “convincing clarifications” by the Presidency.

    Besides, they maintain that there are “no issues” to investigate again, a source said.

    But some members of the committee are said to be adamant, insisting on the investigation of the issues in the August 30 memo of the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu.

    The pressure is believed to have accounted for why the panel has not started sitting since it was constituted by the Senate on October 4.

    It was learnt that in the past two weeks, lobbyists have been trailing Wammako to his residence in Asokoro District.

    One of such high-profile lobbying sessions took place last Wednesday.

    A source said: “These bigwigs actually wanted the Senate to suspend the probe. But the chamber said since the issue was already in the public domain, it will not be good for the image of the Senate.

    “The battle has shifted to the Senate Ad Hoc Committee. Some of these lobbyists have either asked Wammako to either stay away from the probe or work towards a “soft-landing” investigation and report.

    “In one breath, they claimed that since the Presidency and NNPC had made convincing clarifications that there was no contract awarded, going into the allegations contained in the Minister’s memo will be chasing shadows.

    “They alleged that since the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu and the Group Managing Director of NNPC, Dr. Maikanti Baru have reconciled, there is nothing to probe.”

    “Some of the lobbyists are believed to have cautioned the Senate Committee against causing a fresh distress in the oil sector.

    They told some members of the committee that even Kachikwu and Baru did not want the investigation to go on because it might affect the oil and gas industry. About 40 oil firms are likely to be summoned.

    “This is the real reason why the committee has not been able to sit. The chairman and members are really under pressure,” the source said.

    But some members of the committee have insisted that the investigation must go ahead “in the interest of Nigerians” and to protect the integrity of the Senate.

    The logic, according to a member of the committee, is that “since the committee has been mandated by the Senate to look into issues between Kachikwu and Baru, we have no choice than to carry out this legislative duty.

    “To me, I believe the interest of Nigeria is paramount than any other consideration. I believe the probe will go on; what we are working out is logistics,” he said, pleading not to be named.

    Apart from Wammako, other members of the committee are Senators Tayo Alasoadura; Kabiru Marafa; Albert Bassey; Sam Anyanwu; Ahmed Ogembe; Chukwuka Utazi; Rose Okoh and Baba Kaka Garbai.

    The Minister of State for Petroleum Resources, Dr. Edmund Ibe Kachikwu and the Group Managing Director (GMD) of the Nigerian National Petroleum Corporation, Dr. Maikanti Baru, have been locked in a big row over alleged award of $25b contracts, insurbodination and lack of respect for due process.

    Kachikwu asked President Muhammadu Buhari to call the GMD to order.

    He said he was always being blocked from seeing the President.

    Kachikwu, who made his views known in an August 30th, 2017 memo to President Muhammadu Buhari, claimed that five major contracts were never reviewed by or discussed with him or the Board of NNPC. He listed the contracts as follows:

    • The Crude Term Contracts – value at over $10b
    • The DSDP contracts – value over $5b
    • The AKK pipeline contract – value approximately $3b
    • Various financing allocation funding contracts with the NOCs – value over $3bn
    • Various NPDC production service contracts – value at over $3bn – $4bn

    Both the NNPC and its Group Managing Director, Dr. Maikanti Baru have insisted that the transactions were validly conducted within the agency’s expenditure limits.

    They claimed that the board of NNPC cannot approve contracts but they can review and give advice.

    They insisted that the NNPC only carried out transactions and did not award contracts.

     

     

  • NNPC stocks two billion litres of petrol

    NNPC stocks two billion litres of petrol

    The Nigerian National Petroleum Corporation (NNPC) has a stock of over two billion litres of Premium Motor Spirit (PMS), also known as petrol, to ensure a hitch-free end-of-year movement of motorists.

    Speaking after his investiture as Honourary Special Marshal by the Federal Road Safety Corps (FRSC), the Corporation’s Group Managing Director, Dr. Maikanti Baru, said adequate measures were in place to ensure that motorists have unimpeded access to fuel ahead of the forthcoming end-of-year festivities.

    Dr. Baru said provision of adequate petroleum products would not only ease transportation but would also make our roads safer for motorists, just as other consumers too would have no need to hoard highly inflammable products in jerry cans, among others, which may pose as safety challenge to them.

    According to the corporation in a statement yesterday, Baru said: “As we speak, NNPC has over two billion litres of petrol and we want to sustain this level from now on till the end of the year and beyond. This volume would give the country product sufficiency of about 60 days, well above the standard 30 days sufficiency threshold.”

    Describing his investiture as an eloquent testament of the Corporation’s long standing commitment to road safety and support for the FRSC, the GMD said NNPC would remain unwavering in its backing of the FRSC towards achieving its mandate of making our roads safer for motorists and other road users.

    In her remarks, Deputy Corps Marshal in charge of Operations, Ojeme Ewhrudjakpor, who presided over the ceremony, thanked the Corporation for its commitment to road safety.

    Ewhrudjakpor stated that road safety was the responsibility of everyone from motorists to regular road safety officers including special marshals, adding that all have a duty to ensure that the safety target which involves limiting the number of casualties on our road is achieved.

  • NNPC stocks N2b liters of petrol

    NNPC stocks N2b liters of petrol

    The Nigerian National Petroleum Corporation (NNPC) has a stock of over two billion litres of Premium Motor Spirit (PMS), also known as petrol, to ensure a hitch-free end-of-year movement of motorists, a period hitherto sometimes characterized by supply and demand disequilibrium.

    Speaking at the weekend after his investiture as Honourary Special Marshal by the Federal Road Safety Corps (FRSC), the Group Managing Director of the Corporation, Dr. Maikanti Baru, assured that adequate measures were in place to ensure that motorists have unimpeded access to fuel ahead of the forthcoming end-of-year festivities.

    Dr. Baru said the provision of adequate petroleum products would not only ease transportation but would also make our roads safer for motorists, just as other consumers too would have no need to hoard highly inflammable products in jerry cans, among others, which may pose as safety challenge to them.

    According to the corporation in a statement yesterday, Baru said that “As we speak, NNPC has over two billion litres of petrol and we want to sustain this level from now on till the end of the year and beyond. This volume would give the country product sufficiency of about 60 days, well above the standard 30 days sufficiency threshold.”

    Describing his investiture as an eloquent testament of the Corporation’s long-standing commitment to road safety and support for the FRSC, the GMD said NNPC would remain unwavering in its backing of the FRSC towards achieving its mandate of making our roads safer for motorists and other road users.

    In her remarks, Deputy Corps Marshal in charge of Operations, Ojeme Ewhrudjakpor, who presided over the ceremony, thanked the Corporation for its commitment to road safety.

    Ewhrudjakpor stated that road safety was the responsibility of everyone from motorists to regular road safety officers including special marshals, adding that all have a duty to ensure that the safety target which involves limiting the number of casualties on our road is achieved.

  • NNPC stocks 2bn litres of petrol for year-end movements – Baru

    NNPC stocks 2bn litres of petrol for year-end movements – Baru

    Dr Maikanti Baru, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), says the corporation had stocked over two billion litres of petrol.

    In a statement by Mr Ndu Ughamadu, Group General Manager, Group Public Affairs Division, Baru said it would ensure a hitch-free end-of-year movement for motorists.

    Baru said provision of adequate petroleum products would not only ease transportation but make the roads safer for motorists during the yuletide period.

    Also, he said other consumers would have no need to hoard highly inflammable products in Jerry cans, among others, which might pose safety challenge to them.

    ”As we speak, NNPC has over two billion litres of petrol and we want to sustain this level from now on till the end of the year and beyond.

    ”This volume would give the country product sufficiency of about 60 days, well above the standard 30 days sufficiency threshold, Baru,” said.

    Baru, who was also decorated as Honourary Special Marshal by the Federal Road Safety Corps (FRSC), described his investiture as an eloquent testament of the corporation’s long standing commitment to road safety and support for the FRSC. (NAN)

  • NNPC: Two MDs arraigned for alleged forgery of documents

    NNPC: Two MDs arraigned for alleged forgery of documents

    Justice Sedoten Ogunsanya of an Ikeja High Court has ordered the Managing Director and Chief Executive Officer (CEO) of Pure Pack Oil Nigeria Limited, Mr  Epebinu Omoniyi in Kirikiri prison for allegedly forging Nigerian National Petroleum Corporation (NNPC) documents for sale of crude oil and defrauding a business partner of N3million. 

    His co-defendant, the  Managing Director and Chief Executive Officer (CEO) of First Hallmark Energy Limited Pure Pack Oil Nigeria Limited, Mr Adekanbi Adedayo was lucky as he was granted bail in the sum of N1million with two sureties in like sum for the same offense.

    The economic and Financial Crimes Commission (EFCC) had arraigned the defendants on an eight-count charge bordering on conspiracy, obtaining money by false pretences and forgery.

    The defendants denied the charges.

     

    The prosecution led by Mr M.S Owede alleged that company directors committed the offences in 2014 in Lagos alongside Titus Adegoke and Demola Omisore who are both at large.

     

    According to him, the defendants on October  22, 2014, forged a document titled “Letter of Authority To Sell Bonny Light Crude Oil and To Represent the NNPC/Shell JV Operators Bonny Terminal” which was purportedly issued in favour of Pure Pack Oil Nigeria Limited dated October. 22, 2014 and issued by the NNPC.

     

    The charge stated further that the defendants on October 28, 2014, also forged a document titled “Re-confirmation of Allocation in Favour of Pure Pack Oil Nigeria Limited”  which was dated on October 28, 2014,  purporting it to have been issued by the NNPC.

     

    “On December 15, 2014, a document purported to be from the NNPC titled ‘Authority to Sell Cargo on Board MT Gloric’ alleged to be issued in favour of Pure Pack Oil Nigeria Ltd and Dafar Oil and Gas was forged by the defendants.

     

    Owede explained that the defendants allegedly defrauded Mr Ayo Falati their business partner through the presentation of the NNPC false documents for the sale of crude oil and fraudulently obtained N3million from him under false pretences on December 8, 2014.

     

    “They showed him the forged documents and falsely told him that they had secured a contract from the NNPC to supply crude oil from Nigeria to the United States of America.

     

    “The defendants told Falati that the N3million they received from him, represents 1 percent contract performance bond payment.”

     

    After the pleas of the defendants were taken, Owede requested that they should be remanded in prison.

     

    However, counsel to Omoniyi, Mr N.D Momoh requested for more time to file a bail application while Mr J. Opara, counsel to Adedayo urged the court to grant his client bail in the interest of justice.

     

    Justice Sedotan Ogunsanya granted Adedayo N1million bail with two sureties in like sum.

     

    The judge, however, remanded Omoniyi in the Kirikiri Prisons and adjourned the case to December 13 for trial.

  • NNPC $25b contract: Setting the records straight – Osinbajo

    NNPC $25b contract: Setting the records straight – Osinbajo

    Vice President Yemi Osinbajo yesterday maintained that the Nigerian National Petroleum Corporation (NNPC) did not award $25b contracts.

    In a letter to President Muhammadu Buhari, Minister of State for Petroleum Resources Ibe Kachikwu made the allegations, stressing that the contracts did not follow due process.

    A statement by his Senior Special Assistant, Laolu Akande,  titled: ”It is Important to set the records straight”, said: “Claims on social and traditional media that $25b worth of oil contracts were awarded by the NNPC or that $25b in NNPC funds is missing are both false.

    “No contracts were procured by the NNPC based on the leaked memo of the Petroleum Resources Minister of State, even though such impressions have been maliciously created in the past few weeks.”

    He said that a closer look at each of the said projects indicated clearly that “these are not procurement contracts”.

    He added “When I tweeted on Thursday morning last week, I had indicated that the Vice President, while acting as President approved Joint Venture Financing arrangements. But for some curious reasons, a few media reports used that tweet to report that I said the then Acting President approved N640 billion worth of oil contracts. Such reporting is both false and misleading and therefore ought to be completely ignored by all seekers of truth.”

    “What is more important is that when you look diligently at the referenced projects/transactions one by one, you will see, as NNPC has shown, that none of them was actually a procurement contract.”

    “Take both the Crude Term Contract and the Direct Sale, Direct Purchase (DSDP) agreements, for instance; these are not procurement contracts involving the expenditure of public funds. Both transactions are simply a shortlisting process, in which prospective off-takers of crude oil and suppliers of petroleum are selected under agreed terms, and in accordance with due process.

    “It is, therefore, wrong and misleading to refer to them as though they’re contracts involving the expenditure of NNPC funds, or public funds of any sort. As you now know, the Honorable Minister of Petroleum Resources himself has in fact clarified that he meant to focus on administrative and governance issues, not red-flag any fraud – because no fraud exists in this matter.”

    For both transactions, Akande said it was not true and also inaccurate to attach $10b and $5b values on them.

    “Attaching monetary values to these contracts is an arbitrary act that completely distorts understanding of the situation.” he said

    According to him, Nigerians ought to be informed clearly that “whenever there is a monetary value on any consignment of crude oil lifted in this country by any firm, the proceeds go directly to the Federation Account and not to any company. In fact, the Buhari administration in the implementation of the TSA has closed down multiple NNPC accounts in order to promote transparency and probity.”

    Akande also explained that even in compiling the shortlisting for the prospective off-takers of crude oil and suppliers of petroleum under agreed terms, “there were public placements of advert in the mass media seeking Expressions of Interest (EoI). Bids were publicly opened in the presence of NEITI, DPR, BPP, Civil Society groups and the press. In some cases even, these events were televised live.”

    “For the sake of emphasis, let me state clearly that both the Crude Term Contract and the Direct Sale and Direct Purchase agreements are not contracts for any procurement of goods, works or services, and therefore do not involve the use of public funds. Instead, they are simply a shortlisting of off-takers. And unlike what has been reported in the media so far, it is important to set the records straight that the list of approved off-takers does not carry any financial values but simply states the terms and conditions for the lifting and supply of petroleum products.”

    He also disclosed that the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline Contract “is a contractor-financed contract which has not yet been finalized or awarded; it is still making its way to the Federal Executive Council, FEC.”

    He noted that there were also three presidential approvals given on Joint Venture financing arrangements, meaning loans to cater for cash call obligations. One of these was okayed by the President in 2015, and two by the then Acting President in 2017.

    Lastly, on the NPDC, he said there is no contract in the $3BN to $4BN range as reported in the media.

    “You can then see from the foregoing that the $25BN being bandied in the media does not exist. There is no $25BN missing,” Akande concluded.

     

  • NARTO, tanker drivers praise Baru

    NARTO, tanker drivers praise Baru

    The Nigerian Association of Road Transport Owners, NARTO, and the Petroleum Tankers Drivers branch of the National Union of Petroleum and Natural Gas Workers, NUPENG, have commended the Group Managing Director of the Nigerian National Petroleum Corporation, NNPC, Dr. Maikanti Baru, for ensuring seamless supply and distribution of petroleum products across the country.

    Speaking during a visit to the GMD by the associations, the NARTO President, Alhaji Kassim Ibrahim Bataiya, and Chairman of PTD, Chief Otumba Oladiti, were unanimous in their views that fuel supply and distribution matrix had improved under Dr. Baru’s watch.

    According to Alhaji Bataiya, never in the history of the NNPC did the country record such an achievement which has brought about uninterrupted supply of petroleum products nationwide due to the various strategic measures undertaken by the GMD.

    NNPC Group General Manager, Group Public Affairs Division, Ndu Ughamadu disclosed this in statement yesterday.

    The statement quoted Bataiya as saying that “Petroleum products scarcity has now disappeared from our filling stations. In fact, the retail price of the product has also come down from N145 per litre to N143 per litre. You have also extended considerable assistance to transporters by allocating Automotive Gas Oil, (AGO), at subsidized prices to enable them keep their trucks on the road.”

    The NARTO President also thank Dr. Baru for the settlement of their freight bills of about N80 billion owed by the Petroleum Equalization Fund, PEF, Management Board.

    PTD Chairman, Chief Otumba Oladiti, while re-echoing the zero fuel queue strides of the GMD, noted that the sanity brought to bear on the fuel supply and distribution by Dr. Baru should be extended to the refineries said to be scheduled for rehabilitation.

    While urging the GMD and the NNPC Management to remain focused on their mandate to the country, Chief Oladiti assured Dr. Baru of the tanker drivers’ due support.

    Responding, Dr. Baru thanked the members and leadership of the associations for their kind words, noting that his team would do all it could to remain focus

  • No $25 billion contract was awarded by NNPC, says Akande

    No $25 billion contract was awarded by NNPC, says Akande

    The Senior Special Assistant to the Vice President, Laolu Akande, on Sunday maintained that the claims that $25 Billion contracts were awarded by the Nigerian National Petroleum Corporation (NNPC)  were false.
    A leaked letter to President Muhammadu Buhari from the Minister of State for Petroleum Resources, Ibe Kachikwu, had made the allegations stressing  that the contracts did not follow due process.
    But in a statement titled ‘It is Important to set the Records Straight’,  Akande said “Claims on social and traditional media that $25BN worth of oil contracts were awarded by the NNPC or that $25BN in NNPC funds is missing are both false.”
    “No contracts were procured by the NNPC based on the leaked memo of the Petroleum Resources Minister of State, even though such impressions have been maliciously created in the past few weeks.”
    He said that a closer look at each of the said projects indicated clearly that “these are not procurement contracts.”
    He added “When I tweeted on Thursday morning last week, I had indicated that the Vice President, while acting as President approved Joint Venture Financing arrangements. But for some curious reasons, a few media reports used that tweet to report that I said the then Acting President approved N640 Billion worth of oil contracts. Such reporting is both false and misleading and therefore ought to be completely ignored by all seekers of truth.”
    “What is more important is that when you look diligently at the referenced projects/transactions one by one, you will see, as NNPC has shown, that none of them was actually a procurement contract.”
    “Take both the Crude Term Contract and the Direct Sale, Direct Purchase (DSDP) agreements for instance, these are not procurement contracts involving the expenditure of public funds. Both transactions are simply a shortlisting process, in which prospective off-takers of crude oil and suppliers of petroleum are selected under agreed terms, and in accordance with due process.
    “It is therefore wrong and misleading to refer to them as though they’re contracts involving the expenditure of NNPC funds, or public funds of any sort. As you now know, the Honorable Minister of Petroleum Resources himself has in fact clarified that he meant to focus on administrative and governance issues, not red-flag any fraud – because no fraud exists in this matter.”
    For both transactions, Akande said it is not true and also inaccurate to attach $10B and $5B values on them.
    “Attaching monetary values to these contracts is an arbitrary act that completely distorts understanding of the situation.” he said
    According to him, Nigerians ought to be informed clearly that “whenever there is a monetary value on any consignment of crude oil lifted in this country by any firm, the proceeds go directly to the Federation Account and not to any company. In fact, the Buhari administration in the implementation of the TSA has closed down multiple NNPC accounts in order to promote transparency and probity.”
    Akande also explained that even in compiling the shortlisting for the prospective off-takers of crude oil and suppliers of petroleum under agreed terms, “there were public placements of advert in the mass media seeking Expressions of Interest (EoI). Bids were publicly opened in the presence of NEITI, DPR, BPP, Civil Society groups and the press. In some cases even, these events were televised live.”
    “For the sake of emphasis let me state clearly that both the Crude Term Contract and the Direct Sale and Direct Purchase agreements are not contracts for any procurement of goods, works or services, and therefore do not involve the use of public funds. Instead, they are simply a shortlisting of off-takers. And unlike what has been reported in the media so far, it is important to set the records straight that the list of approved off-takers does not carry any financial values but simply states the terms and conditions for the lifting and supply of petroleum products.”
    He also disclosed that the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline Contract “is a contractor-financed contract which has not yet been finalized or awarded; it is still making its way to the Federal Executive Council, FEC.”
    He noted that there were also three presidential approvals given on Joint Venture financing arrangements, meaning loans to cater for cash call obligations. One of these was okayed by the President in 2015, and two by the then Acting President in 2017.
    Lastly, on the NPDC, he said there is no contract in the $3BN to $4BN range as reported in the media.
    “You can then see from the foregoing that the $25BN being bandied in the media does not exist. There is no $25BN missing,” Akande stated.
  • $25bn contract row: Buhari orders NNPC to close multiple accounts

    $25bn contract row: Buhari orders NNPC to close multiple accounts

    Fresh indications emerged yesterday that all revenues of the Nigerian National Petroleum Corporation (NNPC) will now go into the Treasury Single Account (TSA) because President Muhammadu Buhari has ordered the closure of the agency’s multiple accounts.

    It was, however, gathered that the closure has not been “fully accomplished”.

    The process was said to be on as at the time of filing this report.

    Findings made by our correspondent indicated that the closure of the multiple accounts was part of the steps made to streamline the operations of the agency.

    A top government source, who spoke in confidence, said: “The President is actually not blind to the rot in NNPC, and he is addressing the challenges gradually. He is not granting anybody indulgence in the corporation.

    “For instance, the President has directed the NNPC to close all its multiple accounts in Nigeria and abroad. All the revenues of the corporation are now to be paid into the Treasury Single Account (TSA).

    “The procedures of closing all the accounts have started but not fully accomplished. Compliance is being fully monitored by the government.”

    On some issues raised in the August 30 memo of the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, the source added: “The government will consider the observations as part of the ongoing reforms of the agency.”

    In a related development, Vice President Yemi Osinbajo has released the details of the approvals he granted on the financing arrangements to replace the traditional Joint Venture Cash Call obligations.

    The Vice President made the clarifications in a statement issued by the Senior Special Assistant to the President on Media & Publicity (Office of the Vice President), Mr. Laolu Akande.

    The statement said: “Our attention has been drawn to some misleading reports suggesting that the Vice President approved certain procurement contracts for the Nigerian National Petroleum Corporation (NNPC).

    “This is totally false as the approvals referred to were actually for financing arrangements in replacement of the traditional Joint Venture Cash Call obligations.

    “In the statement of NNPC recently released in response to allegations made by the Minister of State for Petroleum Resources, reference was made to various financing arrangements with NNPC’s Joint Venture Partners, which were approved by the Presidency under the current administration.

    “There were three such loan financing arrangements made for: (i)NNPC/Chevron Joint Venture Project; (ii) NNPC/Chevron Accelerated Upstream Production Project; (iii)NNPC/Shell/Total/Agip Joint Venture Accelerated Upstream Production Project.

    “While the first was approved by the President in person, the second and third were approved by the Vice President as Acting President.

    “The NNPC Act, Cap. N. 123, Laws of the Federation, (updated to 2010), authorises the Corporation to borrow such sums as it may require in the exercise of its functions.

    “Sub section (2) goes further to specify the only precondition: “The Corporation shall not, without the approval of the President, borrow any sum of money whereby the amount in aggregate outstanding on any loan or loans at any time exceeds such amounts as is for the time being specified by the President.”

    “Furthermore, subsection (4) provides that “Where any sum required aforesaid – (a) is to be in currency other than Naira; and (b) is to be borrowed by the Corporation otherwise than temporarily, the Corporation shall not borrow the sum without the prior approval of the President.

    “These financings are purely commercial loans obtained by NNPC and its Joint Venture partners, mainly from local and foreign banks, to perform their exploration and production activities. Repayments are also made out of revenues from the crude oil produced directly by the funded project.  Unfortunately, they are being confused with contracts for goods and services.

    “The alternative financing arrangements became necessary as inability of Government to meet its cash call obligations had stalled further investments in the petroleum sector and reduced the country’s production capacity.”