•It’s time to lift the veil on transactions
Time again for our lawmakers to go after ringworms when a more malignant disease of leprosy is indicated: At a time no discernable pathway to resolution of the alleged missing $20 billion is anywhere in sight, the House of Representatives, last week, gave approval for a $1.56 billion loan for the Nigerian National Petroleum Corporation (NNPC).
We consider it bad enough that the details of the loan curiously described as “forward sale agreement” are at this time known only to both the NNPC and the joint committees of the House on Petroleum Resources (Upstream)/Petroleum Resources (Downstream), Loans and Debts/Justice. But worse is that the House opted to put the cart before the horse when it first handed the NNPC the carte blanche to burden Nigerians with the odious debts before requiring it to “develop the roadmap for offsetting its indebtedness”.
More tragic of course is that the House, which professes to share in the public indignation over the pervasive rot in the corporation, appears to have in equal measure, passed off the consideration of another simmering scandal – the controversial crude-oil-for refined products swap under which a huge chunk of the 445,000 barrels of crude meant for local consumption is exchanged for refined products in circumstances that lack transparency as they are baffling.
Last week, the Chairman of the House of Representatives Committee on Finance, Abdulmumin Jibrin, actually dismissed calls for the investigation of the Crude Oil Swap insisting that “the House can’t waste its precious time for another round of exercise”.
His words: “Our House committee has been neck deep in querying and investigating NNPC, Department of Petroleum Resources, Accountant-General of the Federation and the Federal Inland Revenue Service on a frequent basis about several transactions that impact on the oil revenues paid into the Federation Account”.
He would claim rather dismissively that “a lot of information out there on the swap template is over-exaggerated”.
We do not agree. Indeed, the House, in failing to undertake an inquiry may actually be guilty of abdicating its responsibility.
The issues behind the call are hardly new. At the heart of the scandal is the national oil corporation whose four refineries with combined capacity to refine 445,000 barrels of crude per day, but which in more than a decade have operated only at a fraction of capacity, yet received and perhaps continues to receive, crude volumes equal to the said total capacity only to sell the latter at substantial discount, at humongous costs to the treasury.
The Nigerian Extractive Industries Transparency Initiative (NEITI) had in its audit report submitted to the National Assembly, accused four oil companies of under-delivering products worth $8 billion in 2011 under the crude-for-refined products swap. The companies are Trafigura (173,786,600 litres); Vitol (654,440.7 litres); Taleveras (152,308,878 litres); Aiteo Nigeria Limited (193,046,590 litres) and Ontario Oil and Gas (180,278,732 litres).
Today, two of them, Taleveras and Aiteo – with absolutely no previous experience in running producing oil assets – have since emerged as owners of Shell Nigeria’s oil blocks – Oil Mining Lease (OML 29) with its 97-kilometre Nembe Creek oil pipeline sequel to their posting of the highest and unmatched bid of $2.85 billion for the assets.
Unlike the House, we do not find anything strange in the request to beam the searchlight on the oil-swap deal – something that is easily the engine room of the opaque economy of oil. The same goes for the demand to know about the operations of the two unknown quantities, given their past but troubling ties to the NNPC. That the House cannot appreciate this elementary demand for transparency is not only disappointing but tragic.
