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Power contract scandal

Posted by By Jossy Idam on 2008/03/30 | Views: 719 |

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Power contract scandal

Nigerians are still wringing their hands and shaking their heads in disgust by the shocking disclosures at the just concluded public hearing of the House of Representatives committee on Power and Steel. First, staggering figures have been popping up like pin-pong balls. President Umar Yar’Adua earlier mentioned 10 billion dollars.

* Mago-mago figures, half-truth and way forward

Nigerians are still wringing their hands and shaking their heads in disgust by the shocking disclosures at the just concluded public hearing of the House of Representatives committee on Power and Steel. First, staggering figures have been popping up like pin-pong balls. President Umar Yar’Adua earlier mentioned 10 billion dollars.

The nation’s former due process exponent –– Oby Ezekwesili countered and gave hers as four billion dollars. The speaker of House of Representatives, Dimeji Bankole released a whooping 16 billion dollars. Fixated on this figure, the house committee went to work. After the appearances of some of the key players of the National Integrated Power Project and more conflicting figures, the committee has now put the expenditure at 13 billion dollars. The unavailability of a ready, clearly cut and dry expenditure on the project exposes a structural failing of the past administration.

The alibi for the confusing figures, Sunday Sun heard, is that the project is an ongoing and that a significant amount of the money alleged to have been spent are tied down in the Central Bank of Nigeria and letters of credit. The arrangement only allowed the contractors to access the money when they have attained certifiable milestones in the project.

The former Power and Steel Minister, Liyel Imoke, now governor of Cross River State, corroborated this at the hearing. As the helmsman of the ministry from 2003 to 2006, Imoke told the committee the companies had letters of credit and loudly wondered why some companies were paid up to 60 to 100 percent for contracts not completely executed.

What went wrong?
Disclosures at the hearing further revealed that 34 companies not registered with Corporate Affairs Commission, bided and won some of the controversial jobs. The former military head of state, General Abdulsalam Abubakar is even alleged to be chairman of one of the companies - Enego. The company, Sunday Sun learnt, was given a contract to build a transmission line from New Haven, Enugu to Ikot Ekpene, Akwa Ibom State. But while the job is still underway, the company has already been paid N13 billion out of N19 billion. The consultant to the project could not even tell the Ndudi Elumelu headed committee the extent of the job done.

The non-corresponding result of the project is surprisingly heaped on government poor funding. Imoke’s predecessor as Minister of Power, Olusegun Agagu, now governor of Ondo State, certainly rattled the committee members and the country at large when he claimed that the amount spent so far on the project was insignificant. To buttress his point, Agagu compared Nigeria’s energy sector with that of South Africa.

South African example
South Africa is a country of about 50 million people. Its energy sector has installed capacity of 40,000 megawatts. The country even earlier exported power to its neighbouring countries. Recently, the country evaluated its future energy need and decided to peel out about 25 billion dollars to expand its power capacity. A renowned company, Eskom, has been contracted to complete the project in the next five years.

The NIPP was necessitated by the sad six-day nationwide blackout in 2000. Then at its dismal level, only 19 of the 79 power stations worked. Put together, the nation only generated a meager 1,600 megawatts.
To shore up the ailing sector, the Obasanjo government thoughtfully conceived the NIPP and located it mostly in the Niger Delta. The new power plants located at Ikot Abasi, Egbema, Sapele, Calabar, Ihovbor, Omoku and Gbarain with reliable gas source, proximity to the national grid and security of the plants.
The project was also meant to douse tension in the ever-volatile region, to provide employment for the host communities and improve government’s relationship with the people and to redeem its image. To fast track the project, the government halfway funded it from the country’s excess crude revenue.

Pipe dream
Going by the project’s schedule, Sunday Sun found out it is targeted to come on stream November next year. But the date may not be realistic as Sunday Sun investigations reveal that gas turbines meant for the project are gathering rust and dust at the Wharf in Calabar.
The project is further stymied by the fact that the current administration’s hidden agenda to either jettison it and construct a gas pipeline from the Niger Delta to the North or sell it in totality to powerful oligarchs lobbying for it.

Probably working in concert with an interest group, the Director General of the Bureau of Public Procurement (BPP) also known as due process, Emeka Eze goofed at the hearing when he claimed the companies didn’t pass through due process. Certificates of due process earlier given to 29 of the companies were made public last weekend.

Due process waiver
Speaking at the public hearing on Day –8 last Thursday, the former Director General of the Due Process office, Dr Oby Ezekwesili and the former Finance Minister, Dr Ngozi Okonjo-Iweala revealed that due process waivers were given to some companies on Obansanjo’s insistence.
Ezekwesili tongue-lashed members of the National Assembly for lobbying and mounting pressure for the due process rules to be tilted in favour of their companies of interest.

Crucify him
Shocked by the disclosures, the former Petroleum Minister, Professor Tam David-West has literally called for the head of ex-president, Olusegun Obasanjo.
To him, the details from the public hearing smacks of 419 (Advance Fee Fraud). "From the beginning to the end, the whole arrangement looked like 419. Obasanjo has simply 419ed Nigerians. For this, he should be arrested now," he said in a telephone chat with Sunday Sun.

The professor of Virology lashed out on Obasanjo, saying, "If a civil servant or NEPA manager had been accused of these wrong doings, he (Obasanjo) would have hurriedly signed and approved his death sentence. As the law is no respected of persons, I say Obasanjo should be arrested and compelled to explain to Nigerians what he did with our money".
Reacting also on the matter, a radical lawyer in Lagos, Festus Keyamo took a swipe on the former President’s anti-corruption stance. From the overwhelming revelations, "it confirms that his anti-corruption is a farce," Keyamo surmarised.
Describing the House of Representatives public hearing as very redeeming and timely, Kayamo further said that the hearing has "exposed the double speak and double standard of the Obasanjo administration."

With a palpable anger in his high-pitched voice, he loudly wondered why the former president has continued to receive undue and undeserved respect.
"He should be summoned to tell his side of the story. After this, the money must be recovered from him and others," Keyamo insisted.

To his mind, the public hearing should be followed by a probe by either the EFCC or Police, contrary to the belief that NIPP was the proverbial communal goat that belonged to no one in particular, the project derived its powers from Niger Delta Power Holding company and supervised by a presidential team made up of the Vice President (Chairman), Minister of Finance, Minister of Power and Steel, CBN governor, NNPC group managing director and head of due process. Money spent on the project, Sunday Sun learnt, received the nod and approval of the Federal Executive Council.

Way forward
As a way out of the mess, energy experts advice that the baby must not be thrown away with the bath water. The House committee, they suggest, should not recommend or support roll back of the gains of the project. They further suggested that those alleged to have sabotaged the laudable project should be held accountable, adding that the modus operandi of the project should be overhauled and the contractors compelled to go back to site.

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