A Review of the Nigerian Energy Industry

Existing projects: Lawmakers urge NDDC to commit 50% of its funds

*House of Representatives.

Mkpoikana Udoma

15 December 2017, Sweetcrude, Port Harcourt — The House of Representative Committee on Niger Delta Development Commission, NDDC, has charged the Commission to commit 50 percent of its funds to completing existing projects while devoting 30 percent to new projects.

Chairman of the Committee, Nicholas Mutu, gave the charge when he led members of the Committee on an oversight visit to inspect project sites, look at the records of the Commission and evaluate its performance at the Commission’s headquarters in Port Harcourt.

Mutu called for an urgent review and implementation of the Niger Delta Regional Development Master Plan‎.

The Committee directed NDDC to commence the immediate audit of performing and non-performing projects, to address the challenge of the high-rate of project abandonment across the Niger Delta, which according to him was put at over 3,000.

He advised the Commission to set up a mechanism to leverage resources outside the statutory sources of funds by working out partnerships and joint venture arrangements.

“Commit 50 percent of your funds to completing existing projects while devoting 30 percent to new projects, other available funds should be used to pay contractors with outstanding Interim Payment Certificates, IPCs, to facilitate the completion of existing projects.

“This is with a view to determine non-performing contracts and give impetus to NDDC to put in place a mechanism that will help it to mitigate the abandoned project syndrome currently bedevilling the region.

“Going forward, the NDDC should award contracts to only contractors with capacity and focus more on completing on-going projects as an additional measure to mitigate contract failure and enhance value-added service to the Niger Delta region.

“The Commission should undertake this review by facilitating the process and allowing other stakeholders to take leadership in determining the content and objectives of the Master Plan. This will engender ownership by the people and institutions of the region to ensure that it will be accepted and widely implemented by the states, local governments, oil companies, the private sector and civil society organisations, as well as other development partners working in the Niger Delta.”

The House of Reps Committee also appealed to the Federal Government to pay all outstanding debts to the Commission within a reasonable time.

Mutu expressed the Committee’s displeasure with the debts owed the NDDC by the Federal Government and other agencies that contribute to its funding, calling for a change of attitude.

“In future, we expect that all statutory obligations to the NDDC would be paid as and when due. The delay in the release of funds has created a situation whereby the Commission is unable to meet its financial obligations to contractors and stakeholders.”

Earlier, the NDDC Managing Director, Mr Nsima Ekere, said that since the appointment current board and management by Mr President, the NDDC had articulated a new a reform strategy christened the 4-R initiative.

Ekere explain that the reform strategy was meant to improve the performance of the Commission as an interventionist agency, adding that the balance sheet of the Commission was highly bloated.

“We articulated the 4-R initiative to add value to the process of the NDDC, the new initiative will structure our processes and make them transparent; It involves restructuring the balance sheet, reforming the governance protocols, restoring the Commission’s core mandate and reaffirming its commitment to doing what is right and proper.

“We agreed that to move forward, we must find a way to restructure the balance sheet of NDDC and that has led to the cancellation of the first 633 projects worth about 20 billion Naira and then a further cancellation of 432 projects worth a little over 90 billion last week.

“The idea is that there is no point carrying on with non-performing projects in our balance sheet because they only help to make the balance sheet bloated. This is why you hear that NDDC has contingent liabilities running into N1.3 billion.”

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