NNPC AND STRANGE BEDFELLOWS

Nnamdi Ebo canvasses the splitting of the corporation into smaller independent companies

Strange Bedfellows is a 2004 Australian film starring two unlikely companions who engineer a plot to get financial benefits from the government. This unlikely companionship means a strange friendship or fellowship; often used in the phrase “politics makes strange bedfellows”. There are two strange bedfellows who dared to expose institutional corruption to different political masters from north and south and caused shockwaves in Nigeria.

One was born a blueblood, Fulani nobleman, aristocrat; TIME magazine listed him in TIMES 100 list of Most Influential People of 2011; Islamic scholar, technocrat, career banker, became CBN Governor and the 14th Emir of Kano. The other was born a commoner, became a lawyer, Harvard alumnus, pioneered romance journalism, technocrat, General Counsel Texaco Nigeria, Vice-Chairman and General Counsel ExxonMobil Africa, President of OPEC, Group Managing Director of NNPC and Minister of State, Petroleum Resources. Both supermen have something in common — NNPC! Emir Muhammadu Sanusi II (CON) and Dr. Ibe Kachikwu are unlikely companions.

In February 2013, in a letter leaked to Reuters and a local news website, Sanusi caused shockwaves in Nigeria. He alleged that $20 billion (£12 billion) in oil revenues had gone missing. Sanusi had written to President Jonathan claiming that NNPC had failed to remit tens of billions of oil revenues over an 18-month period, January 2012–July 2013 “in gross violation of the law”. NNPC denied failing to account for the money, saying Sanusi’s claim was “unsubstantiated”.

Exactly how much money was missing was unclear, as Sanusi acknowledged in a letter to the Seventh Senate – “$10.8 billion or $12 billion or $19 billion or $21 billion we do not know at this point. . . has been going on for a long time” and could “bring the entire economy to its knees” if it is not stopped. A Senate Committee said Sanusi’s account “lacked substance”. Jonathan publicly dismissed the claim and fired Sanusi for “financial recklessness and misconduct”.

On Tuesday, October 3, 2017, in an August 30 memo to President Muhammadu Buhari, which was leaked and circulated on Twitter, titled: “Matters of Insubordination and Lack of Adherence To Due Process Perpetuated by GMD NNPC – Dr. Baru” ref: HMS/MPR/001/Vol.1/100, Kachikwu caused shockwaves in Nigeria when he said that for over one year, he had tolerated the disrespectful and humiliating conducts of the GMD of NNPC, Dr. Maikanti Baru. Kachikwu said he sent the memo after concerted efforts to have a one-on-one appointment with the president fell through.

The NNPC had announced major appointments and redeployments on August 29 and NNPC Board, which by NNPC statute reviews appointments and postings, was never briefed about the appointments or redeployments. “Members of the board learnt of these appointments from. . .social media and the press release of NNPC. . .I was never given the opportunity before the announcements to discuss these appointments. This is so despite being Minister of State Petroleum, and Chairman NNPC Board,” Kachikwu lamented.

First Lady, Aisha Buhari, in October 2016, declared that there is a powerful cabal running the Nigerian Presidency. She said her husband’s government has been hijacked by a powerful cabal “behind presidential appointments.” Is it possible to be in office without being in power?

Kachikwu alleged that Baru had sidelined the NNPC Board in awards of contracts. According to the minister, the legal requirement is that all contracts above $20 million be reviewed and approved by the NNPC board. It is a preposterous suggestion, against the principle of transparency, during Baru’s tenure as GMD of NNPC, not to run any contract through the NNPC board in over a year.

Kachikwu listed major contracts awarded by Baru without NNPC board input to include: $10 billion crude term contracts; $5 billion direct sales direct purchase (DSDP) contracts, $3 billion AKK pipeline contract, $3 billion financing allocation funding contracts and $3-$4 billion NPDC production service contracts which cumulatively amounted to $25 billion.

Consequently, he appealed to Buhari to approve the suspension of the NNPC ‘reorganisation’. The Ministry of Petroleum Resources said the memo was “a normal procedural correspondence by the Minister to the President. . .most distressing to the ministry of petroleum resources that a confidential communication to the President. . .can be made public,” spokesman for the ministry Idang Alibi stated.

The sprawling NNPC is Nigeria’s oil buyer, seller, explorer, producer, processor, regulator and cash cow, all-in-one. According to a 2010 Stanford University study, NNPC is “at the nexus between the many interests in Nigeria that seek a stake in the country’s oil riches”.

Sanusi and Kachikwu may have challenged pow- erful opponents controlling NNPC. Did Kachikwu’s reforms/due process in the petroleum industry unsettle the cabal? Kachikwu strode into a closeddoor meeting with Buhari, statesmanlike; strode out one hour later, unstatesmanlike. In subdued tone Kachikwu uttered two words to journalists: “No Comment”. The “Odogwu of Onitsha-Ugbo” may require a quo warranto to fight the status quo. For this exposé, will Kachikwu be fired like his strange bedfellow? The anatomy of Kachikwu’s billiondollar-memo “leak” is a fascinating exposé because NNPC is a whistleblower’s paradise. Nigeria’s corruption-infested oil industry has always been prone to a natural monopoly because of rarity of crude oil deposits.

The ‘Standard Oil Monopoly’ landed in America with colonial administration. The ‘Shell Darcy Monopoly’ landed in Nigeria with colonial administration — a coercive monopoly after it struck oil in Oloibiri in 1956. NNPC inherited this notorious monopoly-status. Buhari’s war against corruption should focus on the oil goose prior to the breakup of the NNPC behemoth.

In 1911, America broke up Standard Oil monopoly into 34 smaller independent companies through antitrust legislation, restoring sanity to the US oil industry. The National Assembly should break up NNPC monopoly into smaller independent companies through antitrust legislation. The Minister of Petroleum Resources portfolio should be legislated to prevent embedding it in the presidency. An armistice on “War Against Corruption” will not stop strange bedfellows from their susceptibility to leaks. Indeed, politics makes strange bedfellows with NNPC. www.nnamdiebo.com