Yemi Osinbajo, Enterprise Bank, Entrepreneurship, Tradermoni, SMEs

In a press release posted on its Facebook page, the Presidency today denied rumours of an alleged $25 billion missing from the coffers of the Nigerian National Petroleum Corporation (NNPC). Minister of State for Petroleum Ibe Kachikwu, in a leaked memo had accused the NNPC Group Managing Director (GMD),  Maikanti Baru of unilaterally approving $25 billion worth of contracts.

In its response, the NNPC called the allegations baseless. Apart from the AKK project and NPDC production service contracts, all the other transactions mentioned in the memo were not procurement contracts. The NPDC production service contracts had undergone due process, while the AKK contract had not reached the stage of contract award.

Senior Special Assistant to the Vice President on Media, Laolu Akande  also restated earlier explanations made that Vice President Yemi Osinbanjo had not  approved N640 billion worth of contracts for the corporation, but Joint Venture cash call financing

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,

The Presidency also reiterated the claims made by the NNPC that the crude term contract and the Direct Sale and Direct Purchase Agreements were not contracts for purchase for goods, a misconception that is prevalent in a cross-section of the media.

“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.”Why the rumours will not go away

 

Other allegations

It also appears that the government and the NNPC seems to be focusing on the allegations surrounding the award of contracts only. However, from the letter written to the President by kachikwu, the major crux of his grievance with Baru is an apparent allegation of an abuse of authority by the NNPC GMD. This according to Kachikwu allows the NNPC to by-pass procedures and oversights which it is supposed to be subjected to by the Minister of State. The NNPC is also alleged to be fond of ignoring the Department of Petroleum Resources, the industry regulator, preferring to take decisions on its own volition. Mr Kachikwu also suggested that the NNPC GMD had no respect for his office. These are all salient issues which the government has refused to address in its press releases.

Rumours not going away

Nigerians retain an almost cynical view about the NNPC, even though its transparency has greatly improved under the current administration. The corporation now releases quarterly reports with a wide range of information on its subsidiaries. The public is however of the opinion that the disagreement between Kachikwu and Baru is being swept under the carpet. Vice President Yemi Osinbanjo revealed he had given the NNPC approval for Joint Venture financing agreements, after holding a meeting with the GMD. Findings of prior alleged cases of corruption by the Secretary to the Government of the Federation Babachir Lawal and the Director General of the Nigerian Intelligence Agency (NIA) Ayo Oke have not been released

What the government should do

Head or tail, many Nigerians hold the view that the NNPC is a cesspool of corruption. The shoddy manner the clash between both officials was handled, has also not helped matters. The government should order an independent audit of the NNPC’s accounts from when the current GMD assumed office, and publish its findings

 

 

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