Posted by By Emmanuel Aziken & Emma Ujah on
Abuja —The Federal Government is set to hand over the Eleme Petrochemical Company Limited to an Indian company, Indorama Petrochemicals.....
Abuja —The Federal Government is set to hand over the Eleme Petrochemical Company Limited to an Indian company, Indorama Petrochemicals despite the failure of the company to pay the full value of the purchase price of the nation’s only petrochemical company.
The National Union of Petrochemical and Natural Gas Workers (NUPENG) has meanwhile petitioned the Senate seeking parliamentary intervention into the affair on the basis that past efforts at privatising other national institutions like NITEL were stopped on the failure of the investors to honour their financial obligations.
The controversy meanwhile got deeper at the weekend as the Federal Government through the supervising ministry reportedly ordered the Nigerian management of the complex to handover the running of the company to Indorama Petrochemicals of India.
Vanguard Investigations at the Bureau of Public Enterprises (BPE) revealed that the failure of the company to honour its financial obligations arose from the inability to secure funding for the takeover from the International Finance Corporation, the investment arm of the International Monetary Fund (IMF).
It was gathered that the IFC refused to relax its condition that Indorama secure the deed of transfer for the company and a letter of attorney before it could conclude any deal with the company. Both documents according to BPE sources are tied up at the Nigerian National Petrochemical Corporation (NNPC). Indorama had won the public auction for the privatisation of 75% of the assets of EPCL with an offer price of $200 million, a value NUPENG in its petition to the Senate described as ‘‘ignoble’’ and not worth the spare parts available at the plant.
As with all other BPE transactions, Indorama was expected to pay 10% of the purchase sum within ten days and the remaining balance within sixty days. However, the company according to BPE sources and sources in EPCLhas been able to pay only about 40% of the purchase sum, necessitating postponement in payment schedules.
incapacity of the investor to pay its obligations according to government sources is the failure of the IFC to grant the loan requested by Indorama to consummate the deal. The IFC it was learnt has so far refused to grant the request because Indorama is unable to provide the deed of transfer and a letter of attorney. The original letter of attorney issued by the NNPC for the sale of EPCL had mandated the BPE to sell 51% of the company, but the BPE in a move said to have been forced on it by high government sources sold 75% of the company to Indorama. The original letter of attorney as publicised in the advertisements by BPE in some national newspapers in June 2005 had only specified the sale of 51% of the company.
Meanwhile it was learnt at the weekend that the company’’s management has been ordered by the Ministry of Petroleum Resources to handover the company to Indorama, a development that has piqued the workers and some other stakeholders of the company. Reacting to the development, the national President of NUPENG, Comrade Williams Inko described the whole exercise as a fraud that was capable of giving away a national heritage for nought. ""I will say the whole process is fraudulent by my own assessment, it is the giving away of public assets. We were given the impression that a credible foreign technical partner was coming to come and partner our management to turn around the fortunes of the plant in line with federal government reform policies.’’’’ He however, described Indorama as at best a cement bagging company without the requisite experience to manage a petrochemical company.
""Up to now after the concession was granted on the 23rd of December 2005, the people have been unable to pay and two concessions have been given to them and yet, they have been unable to pay. The first one was on 30th March 2006, the second concession was also granted for them to pay on the 30th of June, but they also failed. The latest now is that they have also been granted another concession after they failed to meet the last deadline of 30th July and up till now, they have been unable to pay.’’’’ ""So, we still wonder why the BPE has not disqualified them as stated in the rules. Also in the course of our investigations, we also discovered that these people have never handled any petrochemical plant before.
What they have been dealing with was a cement packaging company somewhere in India and the employees that they brought in here have only, two or three years experience and they were employed specifically for the privatisation of EPCL and the company was registered in 2003 and they are coming here to revamp a company that has been in existence for more than fifteen years and with staff who have worked in the oil industry for more than twenty five years. How can that be? You cant take from the bucket to fill a river, but that is what we are experiencing today, it is an irony.