Nigeria’s oil subsidy report controversy deepens

Emmanuel Aziken,
Emma Ujah and Ben Agande

24 April 2012, Sweetcrude, LAGOS — Nigeria’s House of Representatives was in a war mood, Monday as its officials and concerned stakeholders in the oil industry prepared for Tuesday’s debate on the report of the investigations into the management of the petroleum subsidy regime.

Speaker Aminu Tambuwal dismissed threats of impeachment directed against him on account of the report’s indictment of major political and economic players. He vowed to proceed with the debate irrespective of the anger of those indicted.

The nation’s governors were, meanwhile, ensconced in a meeting last night pondering over the report of the House committee with a view to proposing reforms to eliminate the corruption in the oil sector.

Lawmakers shun invitation to OTC
Meanwhile, in a way of further insulating themselves from further embarrassment, members of the House of Representatives invited to the Oil Technology Conference (OTC) taking place in Houston, United States of America, have declined the invitation. The Senate delegation to the OTC, equally invited for the conference on the sponsorship of the oil marketers, was as at last night yet to give any indication of whether or not it would be declining the invitation.

Some of the marketers indicted by the Rep. Farouk Lawan-led ad-hoc committee were, however, adamant on Monday in their rejection of the report as pertaining to them. They alleged that their indictment without appropriate hearing was a great injustice.

Chief Mike Ozekhome, (SAN) who is lead counsel to some of the marketers, said on Monday that he was yet to file a motion to stop the House debate on the report but reiterated his determination to do so.

The House in a statement issued in Abuja on Monday, warned Nigerians to be wary of some people which it accused of sustaining the rot in the polity. In the statement issued by House spokesman Rep. Zakari Mohammed the House drew attention to those it claimed were satisfied with putting “unmerited resources in individual pockets at the expense of the people.”

The House statement followed the protests by many of those indicted by the report of the ad-hoc committee notably the NNPC and the oil marketers who were collectively asked to refund more than N1 trillion of undeserved payments from the subsidy fund.

While the NNPC came under severe criticism from the committee for its non-transparent dealings, the corporation has denied any involvement in shoddy dealings while some marketers indicted by the committee alleged that they were not given fair hearing as the committee did not invite them to appear before it.

The House, in its retort, said the action of the marketers and the NNPC was a diversionary tactic calculated to undermine Tuesday’s debate on the report by the House.

The House statement said: “Despite repeated appeals b y the Farouk Lawan-led committee to all those who had anything to do with the country’s subsidy regime between 2009 and 2011, to come forward and make representations before it, some of these organizations conveniently chose to stay away obviously because they have something to hide only to turn around now to claim non-invitation?

“We hasten to ask: Were the focus to be on verification of payments for contracts award, would these same marketers and organisations have stayed away alleging non invitation?

“Regarding the Group of 18 marketers who were deeply involved in the subsidy payouts but declined to appear before the ad-hoc committee, the purported recourse to legal action is, in our opinion, an orchestrated plot to scuttle the findings of the committee.

“For the Nigerian National Petroleum Corporation, claims that the ad-hoc committee report may have been altered to embarrass it (the NNPC), is only in tandem with the current reckoning of its spokesman as the ‘Chief Denial Officer’. The corporation must have been in possession of another version of the report for it to assert that the one officially laid before the House of Representatives on Wednesday April 18th, 2012 was altered”.

House considers report
“As House of Representatives begins a clause by clause consideration of the report tomorrow (today, Tuesday), we urge all Nigerians to be vigilant and wary of those who would rather that the country continue to be run in the usual corruption laden way which put unmerited resources in individual pockets at the expense of the people”, the statement noted.

It was reliably learnt that an extra-ordinarily powerful Northern Emir and a former president who is still very active in politics called the Speaker and Lawan to either water down the report or stop its public presentation to no avail.

The failure of Speaker Tambuwal to stop the progression of the work of the Lawan committee it was learnt may have fueled the angst against the presiding officer of the House, leading to the alleged effort to mobilise opposition to his leadership.

I’m not worried by threat — Tambuwal
But Tambuwal was unfazed, Monday, saying he was not worried about the threats as he promised to remain focused on providing a transparent leadership to the House of Representatives, in line with his agenda when he was elected as Speaker.

Tambuwal who spoke through his Special Adviser on Media, Imam Imam, said the House will not be intimidated by any person or group of persons.

His words, “He is very focused about what he promised Nigerians when he was elected, which are transparent leadership and selfless service. His determination and vision as encapsulated in his legislative agenda are well on course.

“And Nigerians should be rest assured that the subsidy probe is one in a series of very important probes that the House has initiated. He is assuring Nigerians that the House members will not be deterred until the polity is cleaned.

“The members of the House of Representatives know that as legislators, they are bound to face threats and resistance from many quarters. The important thing is that they will not be intimidated by anybody or group”.

Governors meet over subsidy report
Meanwhile, the nation’s Governors under the platform of the Nigerian Governors Forum, NGF were last night meeting with the report of the House ad-hoc committee as one of the main items on the agenda.

One of the Governors who spoke of the determination of his colleagues to bring sanity to the financial processes in the oil industry said the revelations made by the committee indeed justified the misgivings of the Governors on the deductions that have repeatedly been made by the NNPC from the Federation Account.

“We are meeting through this night and this Farouk Lawan report is one of the main issues on our agenda. You would see that from the revelations so far made that our insistence on stopping these deductions are now proving to be correct,” the Governor said.

“You would also see that what is essentially needed is a thorough reform of the sector to the extent that what goes in and comes out is clearly known. Nigeria is a funny country where you do not know what is produced, what is sold and how much what is sold is sold.”

While commending the initiatives of the House of Representatives, the Governor, nevertheless called for deeper probes to unearth all the areas of leakage in the sector.

Meanwhile, the reverberations from the probe and pledges of legislative integrity by the leadership of the House of Representatives came to fore yesterday as House members invited to the OTC by the NNPC and other marketing companies turned down the invitation.

The NNPC and some of its joint venture partners it was learnt had earmarked 15 Senators and House members for sponsorship to the Oil Technology Conference in the United States. The conference is scheduled to take off next Monday.

The House members invited for the conference by the NNPC it was learnt met with Speaker Tambuwal on Sunday night where it was jointly agreed to turn down the invitation. The members it was learnt were not prodded by the Speaker in taking the decision.

It was, however, mum yesterday as Senators also invited for the same conference were unwilling to make known their decision on whether to accept the invitation or not.

Marketers yet to file motion
Meanwhile, Chief Mike Ozekhome, SAN the lead counsel of some of the oil marketers protesting what they claimed to be their wrong indictment did not file his motion in court to stop the consideration of the House committee report as expected.

Following a meeting with his clients, Ozekhome said: “We are still discussing, we have not filed a motion to stop the debate yet. But after getting relevant facts from the marketers, we will tell the court why the debate should be stopped.”

One of the protesting oil firms, Integrated Oil & Gas Ltd, IOG, on Monday, again reiterated its rejection of the House report and its recommendation that the company refunds N13.252 billion to the federal government.

Mr. Uche Onyeagucha, leading several other lawyers for the company said that there was no basis whatsoever for the recommendation, as there were no discrepancies in the figures presented before the committee during its public hearing.

“The refunds have apparently been ordered on the basis that the company may have drawn refunds from the fuel subsidy programme, over and above that which it is entitled. We have found no basis upon which the very serious allegations of subsidy overpayment can be anchored.

“Our Client completely and totally repudiates and denies any allegations of wrongdoing in relation to the Petroleum subsidy reimbursements as they have always operated their oil trading business, in an honest, transparent and open manner.

“There is no evidence that the company owes any refunds at all to be made to the government, not to talk about the imaginary N 19 billion reproduced in the context of the offending House of Reps Committee report”, Mr. Uche Onyeagucha, leading several other lawyers, said.

He contended, further that nobody objected to the figures of the IOG in terms of the volume of products it imported and the amount it was paid, during the hearing and questioned how the committee came about the N13.252 billion refund recommendation.

The public should know
His words: “We need to explain to the public. Before you can start importing, the PPPPRA needs to give you approval to supply, for example 10 million metric tons. After you have been given that approval to supply that 10 million metric tons, you take that documentation from PPPRA to CBN to request them to make it possible to have foreign exchange with which to pay for that amount of metric tonnes for which you have got approval.

“After you have gotten that, because nobody has all this money, you would now go to one of the commercial banks to raise money to make this purchase. It is only after you have got these that you may now go and do your transactions. When your product comes, the data must agree with the figure you have been approved to bring by the CBN, the amount at the initial stage by PPPRA, the foreign exchange that CBN approved for you, the amount of facility that the commercial bank has given to you and finally, when it comes, you will receive payment to that figure.

“Unless the Ad-Hoc Committee is able to show that there is any discrepancy within any given period of time it will be spurious for them to arrive at such a bogus figure of N13 billion that is due for refund. And we believe they manufactured this figure from the moon, hence we are challenging it that it is dubious.

“We are saying, tell us at what point anybody’s figures were in conflict with our own. Even those whose figures were in conflict were given opportunities of a second hearing to come and explain how come their figures were in conflict. Nobody invited us a second time. Nobody made allegations to show there were discrepancies in figures. Nobody gave any evidence that there were discrepancies in our figures. So how did the Farouk Lawan committee come about such a figure”?

The company said that its records were open to review at any time by any interested persons as it had nothing to hide, describing itself as Aa reputable firm”.

Mr. Onyeagucha said that the company had petitioned the House of Representatives and heading for the courts to seek redress but had to also present its facts in the court of public opinion to save its hardearned reputation.

He said that the company had to invite the EFCC to investigate its fuel imports under the subsidy programme to determine any wrong doing, insisting that there must be an ulterior motive for that N13. 252 billion repayments recommendations which Hon. Lawan and his committee must answer.

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  • This issues shulod not come as a surprise to anybody. We don’t need any committee to unearth the shady deals that thrive in the Oil sector, but now that the committee is in the know what do they intend to do about it? What punitive measures are they going to engage in dealing with the culprits? What will be the compensation to the suffering Nigerian masses? We are watching as the drama continues. God bless Nigeria.