Buhari keeps mum equally N9 trillion contract scandal rocks NNPC

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President Muhammadu Buhari is yet to clear the air nearly grievous allegations of abuse of contract procedure to the melody of N9 trillion naira at the Nigerian National Petroleum Corporation, to a greater extent than than 24 hours after leakage of an internal memo which detailed the allegation.

Presidential spokespersons, Femi Adesina too Garba Shehu, did non pick or provide calls, or answer to text messages on the affair despite concerns expressed yesteryear Nigerians too activists.

The Minister of State for Petroleum Resources, Ibe Kachikwu, detailed the questionable deals when he alerted the president to the activities of the Group Managing Director of NNPC, Maikanti Baru.

In the August xxx correspondence, Mr. Kachikwu said Mr. Baru circumvented extant procurement regulations inward awarding a serial of contracts upwards to $25 billion —or N9 trillion at prevailing central charge per unit of measurement of N360 to a dollar— warning of grave consequences the decisions could wreak if allowed to stand.

The alphabetic quality appeared on the Internet around noon Tuesday, merely no ane has claimed credits for its leakage.

Mr. Kachikwu gave a breakdown of the contracts said to conduct keep been awarded without recourse to the Ministry of Petroleum or the direction board of the NNPC; including $10 billion unsmooth term contracts; $5 billion straight sales straight buy (DSDP) contracts too $3 billion AKK pipeline contract.

He likewise said a $3 billion was awarded equally a contract for diverse financing allotment funding contract too some other $3-4 billion NPDC production service contracts.

CRUDE TERM CONTRACT

The unsmooth term is the annual contract which the Nigerian regime enters amongst firms willing to create elevator unsmooth oil inward the province through competitive bidding.

About 39 companies won the contract for the 2017-2018 bids, out of 224 bids submitted, according to the NNPC.

The winners included xviii Nigerian companies, xi international traders, 5 unusual refineries, iii national oil companies (NOCs) too 2 NNPC subsidiaries.

All the contracts are for 32,000 barrels per twenty-four hours except Duke Oil Ltd, an oil trading arm of the NNPC, which secured 90,000 barrels per day.

The Senate on Wednesday, however, resolved to investigate the allotment to Duke Oil, after a senator alleged it was fraudulently done.

AKK CONTRACT

The AKK contract pipelines contract was awarded yesteryear Mr. Baru for the installation of the novel Ajaokuta-Kaduna-Kano gas pipelines. Estimates for the contract ranged from $2.3-2.7 billion.

The NNPC announced inward May that a Chinese theatre won the contract to consummate 80 per cent of the projection on public-private partnership basis. Mr. Baru was likewise reported to conduct keep confirmed receipt of $250 1000000 from Chinese banks for the take-off of the project.

Some Nigerian senators raised concerns nearly the contract presently after it was awarded, merely the Senate resolved non to accept activity until in that location is plenty evidence of wrongdoing.

DSDP CONTRACT

The Direct-Sale–Direct-Purchase was adopted yesteryear the Buhari direction final twelvemonth to supervene upon the unsmooth oil swap initiatory too the offshore processing arrangement.

The policy, which was designed yesteryear Mr. Kachikwu when he was soundless the GMD of NNPC, was aimed at entrenching transparency inward the unsmooth oil for production transaction yesteryear the NNPC.

Under the unsmooth oil swap initiative, unsmooth oil was exchanged for crude oil products through third-party traders at a pre-determined yield pattern.

Mr. Kachikwu said the DSDP pick eliminates all the cost elements of middlemen too gives the NNPC the latitude to accept command of sale too buy of the unsmooth oil transaction amongst its partners.

NPDC PRODUCTION SERVICE CONTRACTS

The Nigerian Petroleum Development Company is a subsidiary of the NNPC that majors inward the production of unsmooth oil. The theatre is responsible for the command of oil wells owned too managed yesteryear the NNPC.

The production service contracts are contracts awarded for production of unsmooth oil from oil fields run yesteryear the NPDC.

The NPDC, due to its operational too capacity deficiencies, regularly enters production contracts amongst other oil companies — peculiarly oil majors similar Agip too Shell— to elevator unsmooth based on quantities determined inward their contract.

The government minister said Mr. Baru shunned procedural requirements which stipulated that whatever contract honor over $20 1000000 must live on reviewed too approved yesteryear the NNPC board to live on valid.

DISRESPECT

Other than the claims of questionable draw organisation decisions of Mr. Baru, Mr. Kachikwu likewise informed Mr. Buhari that he suffered “disrespectful too humiliating conducts” from the NNPC GMD.

The NNPC is an way nether the Ministry of Petroleum Resources, where Mr. Kachikwu serves equally government minister of state. President Buhari kept the substantive Minister of Petroleum Resources post to himself.

Ndu Ughamadu, a spokesperson for the NNPC, declined comments on behalf of Mr. Baru throughout Tuesday too Wednesday.

Mr. Ughamadu, NNPC’s caput of media, told PREMIUM TIMES Tuesday that the alphabetic quality was non meant for populace consumption.

“It was a individual communication betwixt political party H5N1 too political party B,” Mr. Ughamadu told PREMIUM TIMES yesteryear telephone Tuesday afternoon. “I don’t recollect it’s proper for us to comment on that.

Mr. Kachikwu said he wrote the memo after concerted efforts to conduct keep a one-on-one twenty-four hours of the month amongst the president at the State House cruel through.

The government minister after confirmed authorship of the alphabetic quality inward a Tuesday nighttime argument merely said he was distressed yesteryear its leakage.

Idang Alibi, a spokesperson for the ministry, described the alphabetic quality equally business office of routine exchanges Mr. Kachikwu regularly shares amongst the president nearly “developments inward parastatals nether his supervision.”

Mr. Alibi likewise said the alphabetic quality was aimed non at disparaging Mr. Baru merely at “improving efficiency too deepening transparency inward the oil too gas sector for continued investor confidence.”

Mr. Kachikwu said the allegations writ large on Mr. Buhari’s avowed intolerance of corrupt practices too abuse of procedure inward populace service.

But neither the president nor his media squad has commented on the controversy, thereby leaving the populace inward the dark, peculiarly equally to whether whatever activity had been taken since Mr. Kachikwu’s alphabetic quality was sent on August 30.

The president remained mum, whereas the Senate has taken immediate steps to unravel the controversy, raising an ad-hoc panel to investigate all the elements alleged precipitous practices contained inward Mr. Kachikwu’s letter.

The nine-member commission is headed yesteryear Aliyu Wamakko, an APC senator from Sokoto State.

Mr. Kachikwu previously doubled equally the Minister of State for Petroleum too GMD of NNPC until he was relieved of the latter post yesteryear Mr. Buhari on June 4, 2016, same twenty-four hours that Mr. Baru was named equally a replacement.

Industry experts warn that the feud could conduct keep riveting consequences on Nigeria’s oil sector, which is the country’s lifeline.

Bala Zaka, a crude oil engineer, said NNPC’s stock prices would conduct keep plunged significantly had it been a listed company.

“If NNPC was listed on the stocks exchange, its stocks would conduct keep crash hence much that it won’t live on able to recover for many years,” Mr. Zaka said.

Mr. Zaka said Mr. Kachikwu’s revelations betoken that the NNPC, which had been dogged yesteryear corruption since its creation inward 1977, had non changed fifty-fifty nether Mr. Buhari.

“This farther confirms that in that location has been no alter inward the NNPC since the days of Diezani [Alison-Madueke],” he said.

Mrs. Alison-Madueke has been defendant of diverse acts of corruption piece she held sway equally the Minister of Petroleum Resources betwixt 2010 too 2015. Several properties linked to her has been forfeited to the federal regime although she remains inward the Britain where she is likewise existence investigated for coin laundering.

Another surface area Nigeria may endure from the conflict betwixt Messrs. Kachikwu too Baru is the sale of licences for marginal oil fields, Mr. Zaka said.

“They’ll get calling for bids for those interested inward licences for marginal oil fields,” Mr. Zaka said. “Serious draw organisation persons mightiness rest away because they don’t conduct keep confidence that the exercise would live on transparent.”

Civic groups conduct keep likewise joined calls for immediate probe of the allegations raised yesteryear Mr. Kachikwu.

Eze Onyekpere of Centre for Social Justice inward Abuja said inward a argument to PREMIUM TIMES on Wed that the allegations are weighty too must non live on swept nether the carpet.

“It is imperative that the extant allegation is non swept nether the carpet,” Mr. Onyekpere said. “Otherwise, the morality of continued prosecution of persons defendant of lesser economical too fiscal crimes volition instruct a dependent plain for serious questioning.”

The Buhari direction already has 2 major corruption scandals that conduct keep non been clarified.

The president has non acted on the study nearly the ownership of nearly $289 million  that rocked the National Intelligence Agency inward Apr too some other claim that the suspended Secretary to the Government of the Federation, Babachir Lawal, was routing monies meant for the internally displaced persons into his personal depository fiscal establishment accounts.

Until now, Messrs. Kachikwu too Baru had largely concealed their feud from the media, although it was kickoff hinted to a greater extent than than a twelvemonth ago.

In September 2016, the Daily Independent inward Lagos reported a friction betwixt Mr. Kachikwu too Mr. Baru, which centred on the administration’s Niger-Delta policy.

While Mr. Kachikwu, a native of Delta State, urged peaceful resolution too increased economical evolution for the restive region; Mr. Baru was inward favour of a armed services crackdown on criminal elements vandalising oil pipelines, Daily Independent reported.

The NNPC GMD said the economical sabotage yesteryear militants had cutting deeply into the country’s revenues, a province of affairs he said was unsustainable.

Mr. Kachikwu did non play upwards the Niger-Delta crisis inward his latest alphabetic quality to Mr. Buhari, focusing instead on the consequences of disregard for extant regulations inward the wake of disruptive technological advancements which could run into fossil fuel instruct redundant inward the years ahead.

The latest spat is non the kickoff fourth dimension Mr. Kachikwu would spar amongst some other overstep official over Niger-Delta since he was named government minister inward 2015.

In June 2016, the government minister disagreed amongst his counterpart at the Ministry of Transport, Rotimi Amaechi, over the completion of the Maritime University inward Delta State.

While Mr. Amaechi demanded probe of some funds that had been allocated for the projection merely which were allegedly squandered yesteryear the previous administration; Mr. Kachikwu said the probe could live on done without abandoning the academy site, which is situated inward Gbaramatu Kingdom, Delta State.

Mr. Kachikwu’s feud amongst Mr. Baru likewise farther underscores a troubling pattern of internal wrangling inward the Buhari administration.

In July, Usman Yusuf, the suspended executive secretarial assistant of the National Health Insurance Scheme engaged the Minister of Health, Isaac Adewole, inward a tussle over supremacy.

A few days earlier then, Attorney-General Abubakar Malami had an opened upwards dispute amongst the acting chairman of the EFCC, Ibrahim Magu, amongst Mr. Malami accusing Mr. Magu of failing to study to him equally required yesteryear extant EFCC regulations.

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