Crude oil swap: Aiteo winds down Duke oil deal

Kunle Kalejaye 20 June 2015, Sweetcrude, Lagos – The board of Aiteo Group has announced the winding down of the Duke Oil Swap and Offshore Processing Agreement, OPA, contract, bringing its business relationship with Duke Oil to a closure.
aiteoThe company’s decision to end the deal is contained in a statement made available to SweetcrudeReports and is sequel to reports alleging underhand dealings in the deal.
Allegations are that Aiteo gulped $150 million under the deal, but the company describes this as baseless and targeted at slurring yts name.
According to the statement signed ‎by Aiteo’s spokesperson, Ms Aiki Odiawa, the company being a corporate entity whose success has been as a result of dynamism, foresightedness and fortitude, it is pertinent that clarification is made to the general public on the position of the company in the Swap deal.
She said in the statement that Aiteo in collaboration with Duke Oil participated in both the Swap crude oil-for-refined-products-exchange programme and Offshore Processing Agreement, which are both governed by robust legally binding agreements with provisions for strict commercial considerations backed by the necessary financial instruments to mitigate and manage potential risks of transactions of this nature.
The statement reads:” AITEO’s participation in the programmes was premised upon AITEO having fulfilled all requirements precedent to being nominated and gaining the objective confidence of the Management of NNPC on its strong competence and ability to deliver on the said contracts as and when due.
“Never at any point has AITEO unfairly exploited its commercial relationship with Nigerian National Petroleum Corporation, NNPC under the SWAP or OPA contracts.”
Odiawa also explained that further allegations by the online media is that by late March 2015, AITEO was more than 20 cargoes in arrears on the new deal, describing this as “completely false.”
“In fulfilment of our outstanding obligation on the Duke Oil SWAP and contracts, we have decided to nominate two cargo deliveries to fully liquidate any outstanding deliveries due to Pipeline and Products Marketing Company, PPMC.
“However, Should there still exist a deficit after reconciling positions, where there is an over delivery, PPMC will issue a credit note in favour of AITEO and if AITEO should have any outstanding, this will either be deducted from on-going cash calls due AITEO from AITEO/NNPC joint venture or an outright remittance as the case may be.
“The Board of AITEO has taken the decision to wind down this Duke Oil SWAP and OPA contract promptly and bring its business relationship with Duke Oil to a closure,” Odiawa said.
Commenting further, Aiteo spokesperson said “it should be noted that AITEO’s OPA with NNPC requires a reconciliation meeting to take place between the parties on a quarterly basis for all crude oil loaded and refined products delivered.
“In a letter dated 9th June 2015, NNPC advised AITEO to schedule a reconciliation meeting with PPMC during which it intends to reconcile the full OPA position to determine over-deliveries and under-deliveries as it relates to each party. In light of this development, the fully reconciled position should be determined soon.”
Odiawa therefore noted that allegations by the online media that AITEO “apparently gulped down $150million” are not only baseless but also aimed to slur the name of the company.
She added that Aiteo promptly obliged to the request of Department of State Security, DSS and Economic and Financial Crimes Commission, EFFC to submit relevant documents and invitation for clarification regarding their participation in OPA and SWAP programmes.
‎Odiawa  however said the company (Aiteo) is  surprised that a matter of fact-find within the purview of the investigative agencies has now been sensationalised by various parties beyond proportion and largely out of context to mislead the public, stressing that none of the company’s Directors or Executive Management has been charged of any offence in any court of law and nor has any restraint order been issued to curtail international travel of any company official.


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