Senate probe yet to produce report on $25b NNPC contract scam, nine months after

By Oke Peter


Nine months after the Senate resolved to investigate alleged $25b contract scam in the Nigerian National Petroleum Corporation (NNPC), no positive step has so far been taken to provide details to anxious Nigerians.

After its inaugural meeting in October 2017, the committee soon buckled under pressure, allegedly mounted on it by the Presidency, and other interested parties, within and without the National Assembly.

Led by a former governor of Sokoto State and a staunch member of the All Progressives Congress (APC), Aliu Wamakko, the committee faced scathing criticisms after its chairman visited the Presidential Villa, only a few days after the body was inaugurated.

The Senate had in the first week of October 2017, resolved to carry out the investigation following the disclosure by the Minister of State for Petroleum, Ibe Kachikwu, of alleged non-disclosure in the award of $25b worth of contracts by the national oil company.

The only member of the nine-man ad hoc committee who responded to text messages on its activities is Senator Tayo Alasoadura (APC, Ondo Central), who simply wrote: “Please talk to the chairman.”

But neither Wamakko nor the Senate spokesman, Aliu Sabi Abdullahi, responded to questions on the matter after many attempts to reach them via phone calls and text messages by The Guardian.

Signs that the exercise may not sail smoothly emerged quite early when the take-off of the investigation suffered initial postponements, before the committee eventually went into coma.

In the last postponement, which was announced by the Deputy Senate President, Ike Ekweremadu on October 17, 2017, Nigerians were informed that the investigation would commence in earnest the following Tuesday. It never happened.

When Senate President Bukola Saraki constituted the ad-hoc panel last year, following a resolution of the Senate and public outcry, the committee was given four weeks to submit its report. That deadline expired November 2017.

It would be recalled that after the Senate announced its decision to probe the alleged contract scam, the Presidency came out to deny the existence of such.

In the August 30, 2017 memo, Kachikwu attributed the slow growth in the oil and gas sector to illegal practices by departments and agencies under his ministry, especially the NNPC headed by the Group Managing Director, Dr. Maikanti Baru.

He told President Muhammadu Buhari that the country’s petroleum industry would have recorded tremendous progress but for Baru’s alleged inaction.

Kachikwu, who also presented five prayers to the President to save the oil sector from collapse said he was disturbed that $25b worth of contracts were awarded by Baru without his input and that of the board.

Kachikwu wrote: “The legal and procedural requirement is that all contracts above $20m would need to be reviewed and approved by the Board of the NNPC. Mr. President, in over one year of Dr. Baru’s tenure, no contract has been run through the board.

This is despite my diplomatic encouragement to Dr. Baru to do so to avoid wrongfully painting you as a President who does not allow due process to thrive in the NNPC.

“Given the history of malpractices and the public perception of the NNPC as having a history of non-transparency, the NNPC Tenders Board (NTB) cannot be the final clearance authority for contracts it enters into.

“The NTB, which is a collection of level NNPC executives and COOs, with the GMD as chairman cannot continue to be the final approval authority for multi-million dollar contracts and transactions involving NNPC to the exclusion of the board.

Board members have singularly and collectively raised these issues to no avail,” the minister stated.

He continued: “As in many cases of things that happen in NNPC these days, I learn of transactions only through publications in the media.

The question is why is it that other parastatals, which I supervise as Minister of State or chair of their boards are able to go through these contractual and mandatory governance processes and yet NNPC is exempt from these?

“I know that this bravado management style runs contrary to the cleansing operations you engaged me to carry out at the inception of your administration. This is also not in consonance with your own renowned standards of integrity.”

Meanwhile, the House of Representatives is poised to probe authorities of the national oil company over the unresolved controversy surrounding the contract award.

The House, ostensibly at the instance of Speaker Yakubu Dogara, felt it should allow the Senator Kabiru Marafa-led Senate Committee on Petroleum (Upstream) to probe the issue when the alleged scam broke, last year.

However, the Deputy Chairman, House Committee on Petroleum (Upstream), Mr. Mark Gbillah, who dropped hint of the impending probe explained that the lower chamber might be constrained to wade into the matter since the Senate appears to have developed cold feet about investigating the matter.

He expressed concern that the issue appears to have been swept under the carpet by the President Muhammadu Buhari-led administration in spite of its much-vaunted war against corruption.

According to him: “Once again, the executive arm has not been able to come out with anything about the NNPC $25b contract scam, just like the controversy surrounding the reinstatement of Abdulrasheed Maina and the involvement of the Attorney General & Minister of Justice.

“For the Senate, we have been waiting on them. We gave them that regard since they were the ones that started the investigation first, and up till now we have not heard anything. If we also wait for sometime, we might have to initiate our own investigation in the House.”

Without mincing words, oil and gas lawyer, and Managing Partner, The Chancery Associates, Emeka Okwuosa, says he is convinced that the National Assembly and the Presidency has succeeded in sweeping the matter under the carpet.

“I believe a committee should have been set up by the President to address the issue transparently and report back to him.

The rivalry between the two most important players in the petroleum ministry is capable of overheating the sector, which we cannot do without at a time like this that we are grappling to maintain our main income earner.”

While insisting that the issue has to be effectively thrashed in order to avert a repeat, Okwuosa urged key stakeholders in the sector to adhere to due process and ensure that extant procurement and tender processes and all extant guidelines are followed in awarding such humongous contracts.

“We need transparency, accountability and due process in the award of such contracts.
Finally, I commend the courage of the minister in bringing this to the open. Also the NNPC chief, Bau should strive not to undermine the minister in future.

The embedded checks and balances in the internal process must be seen to be working,” he said.

Executive Director, Centre for Democracy and Development (CDD), Idayat Hassan, is in sync with Okwuosa, as she maintains that it is the Federal Government that should raise a panel to thoroughly investigate the alleged contract scam

Hassan, who is of the view that nothing new has happened in the sector under Buhari’s watch, warned that the matter must never be swept under the carpet.

“I think it is the Federal Government that must raise a panel to look into the matter, so that it would not be swept under the carpet.

It is unfortunate the Senate has chosen the path of silence, even though oversight is the responsibility of the legislature. They must wake up now and perform their duties,” she admonished.

In the view of the Executive Director, Civil Society Legislative Advocacy Centre, (CISLAC), Auwal Ibrahim Musa, the Buhari administration has purely undermined transparency and accountability in the manner, it has handled the scandal.

Musa said: “The issues that were raised by Kachikwu have not been addressed; there is mistrust between the GMD and the minister of state, and so what we are seeing now is window dressing.

If they are working together collaboratively, and if the whole process is transparent, all these issues would not have arisen.”

Interestingly, the NNPC’s Group General Manager, Public Affairs Division, Ndu Ughamadu insists that: “The issue has been settled long ago,” adding that the corporation did not breach any procedure in the award of contract.

Stressing that the NNPC did not err in any regards in the controversial contracts, he said: “It is important to note from the outset that the law and the rules do not require a review or discussion with the minister of state, or the NNPC Board on contractual matters.

What is required is the processing and approval of contracts by the NNPC Tenders Board, the President in his executive capacity or as Minister of Petroleum, or the Federal Executive Council (FEC), as the case may be.

There are therefore situations where all that is required is the approval of the NNPC Tenders Board, while in other cases, based on the threshold, the award must be submitted for presidential approval. Likewise, in some instances, it is FEC’s approval that is required.”