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Kachikwu allegations: I approved NNPC contracts – Osinbajo

From: Juliana Taiwo-Obalonye, Abuja

Vice President Yemi Osinbajo has admitted to approving contracts for the Nigeria National Petroleum Corporation (NNPC) which had become contentious between the Minister of State for Petroleum Resources, Ibe Kachikwu and the NNPC Group Managing Director (GMD), Maikanti Baru.

Senior Special Assistant on Media and Publicity, Laolu Akande, in a series of tweets on his twitter handle @akandeoj, on Thursday, confirmed that the contracts were approved after due diligence by the Vice President when he acted as President, recently.

Akande said Osinbajo approved the recommendations for the contracts as part of necessary actions to deal with backlog of unpaid cash calls and incentivise investments.

He said Osinbajo made the clarification in view of media enquiries that followed NNPC’s claim that the contracts were indeed approved by Osinbajo.

The tweets stated: “In response to media inquiries on NNPC joint venture financing, VP Osinbajo, as Ag President approved recommendations after due diligence & adherence to established procedure. Action necessary to deal with huge backlog of unpaid cash calls which Buhari adm. inherited and also to incentivise much needed fresh investments in the oil & gas sector.”

Kachikwu’s letter to the President in which he alleged gross insubordination by the Group Managing Director of the Nigerian National Petroleum Corporation(NNPC) Maikanti Baru, was leaked to the media last week.

He had alleged that Baru using the NNPC awarded $25 billion contract without following due process.

He had also alleged that the $25 billion contract was struck without consulting the office of the Minister of State for Petroleum Resources or the board of the corporation.

Baru has earlier in the week responded to Kachikwu’s allegations of lack of adherence to due process in the award of NNPC contracts.

He had said in a statement that the allegations were baseless and due process was followed in all of its activities.

On the allegations by the minister that major contracts were never reviewed or discussed by the NNPC Board, Baru said 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 approval that is required,” the statement said.

It stated further: “It should be noted that for both the Crude Term Contract and the Direct Sale and Direct Purchase (DSDP) agreements, there are no specific values attached to each transaction to warrant the values of $10 billion and $5 billion respectively placed on them in the claim of Dr. Kachikwu.

“It is therefore inappropriate to attach arbitrary values to the shortlists with the aim of classifying the transactions as contracts above NNPC Tenders Board limit. They are merely the short-listing of prospective off-takers of crude oil and suppliers of petroleum products under agreed terms.

“These transactions were not required to be presented as contracts to the Board of NNPC and, of course, the monetary value of any crude oil eventually lifted by any of the companies goes straight into the federation account and not to the company.”

NNPC said Kachikwu was expressly consulted by the GMD and his recommendations were taken contrary to the assertion that he was never involved in the 2017/2018 contracting process for the crude oil.

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2 Comments

  1. ochendo 12th October 2017 at 1:32 pm

    is it possible the presidency could attend to such files without input from the supervising minister.is the government confirming that the supervising minister(who should know the goings-on in his ministry) should not bother knowing about these contracts(in mega thresholds) before assent by the presidency.in the fec meeting and others who defends such proposals.I did local campaign for buhari but I pray we shall never have his kind of government again.there are stories mr president approved bogus contracts while on sick even when he ‘transmitted power’.there were stories mr president asked some back to see the vp(then ag.president) for the affairs of the state.does it mean mr president selected ‘choice matters’ and treated them while on sickbed/sickoff.it is becoming very very clear this government indulges in self deceit and double speak.how come buhari’s government have credibility and competence problems after 16 years of preparation.

  2. alain 12th October 2017 at 2:17 pm

    I have lost hope in this Administration because they are incompetent people except VP and Kachikwu. All I hope now is to see VP book titled; ALL the mess and shit i cleared during Buhari Administration

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