Oil contracts: No $650m scam – Abe

From TONY JOHN, Port Harcourt

Immediate past representative of the Rivers South East Senatorial District at the National Assembly, Magnus Abe, has responded to a report in an online medium alleging that the Minister of State for Petroleum, Timipre Sylva, and his cronies were planning to cover up a $650 million oil contracts scam.

He described the report as an imagination of the figments of the author, as such scam did not exist anywhere.

Abe, in a statement issued in Port Harcourt, Rivers State, yesterday, maintained that, “the said story is clearly designed to create the impression of a major scandal and arm twist the federal government in the matter concerning the recent attempt to revoke some oil blocks from a foreign company, Addax Petroleum”.

He added: “To create the needed sensation, all kinds of names including mine, were dragged into the fray”.

Abe, who is a member of the Board of the Nigeria National Petroleum Corporation (NNPC) said: “For the avoidance of doubt, I recently headed a presidential inter-ministerial committee made up of technocrats from several federal ministries and departments to advise the President on plight of an indigenous engineering and technology Kaztec Engineering limited.

“The committee was set up by a Presidential directive conveyed by the Chief of Staff to the President.
There is nothing in the committee assignment that involved the allocation of oil blocks.

“Nigerians, however, need to know that Kaztec Engineering Limited, a local company, was awarded contracts worth over $650 million by Addax Petroleum, to develop the oil fields operated by Addax Petroleum.

“In 2015, the Federal Government under President Muhammadu Buhari in keeping with its anti-corruption agenda, accused Addax of tax atrocities which resulted in substantial losses to the federal government.

“Addax was asked to pay. In response, they declared a force majeure on their exploration activities and cancelled their investments in the oil fields.

“The Nigerian company Kaztec, a company that has invested over $650 million in the project with Addax was forced to bear the brunt of the entire dispute, which was actually between Addax Petroleum and the Nigerian government.

“Over 3,000 workers were laid off, equipment, vessels, and a fabrication yard worth billions of naira borrowed from Nigerian banks was laid waste”.

Speaking further, Abe said Nigerians should look beyond the needless sensationalism and ask the hard questions that needed to be answered.

He asked: “Who is deceiving the President? Is it Addax the company that was accused of tax fraud, and abandoned its Nigerian investments for over 10 years or the Department of Petroleum Resources that tried to hold them to account for the economic damages they were inflicting on the Nigerian oil economy? Withholding investments at a time when the nation is in dire need?

“For the avoidance of doubt, the Kaztec committee was not set up by Minister of Petroleum to award any oil block, neither is the place of the NNPC to award or revoke oil mining licences.

“The committee report focused exclusively on measures and reliefs which the government can legally extend to the company to salvage the heartbreaking and tragic losses to an indigenous company.

“It is unfortunate that Sahara reporters made no effort to reach me or verify whatever sensational lies it was fed”.

The former federal lawmaker maintained that there was “absolutely no scam on oil blocks, or contracts involved in the Kaztec committee report”.

He explained that issues of revocation, allocation and management of oil blocks were exclusively the preserve of the Department of Petroleum Resources (DPR).

Abe said: “In the light of the abandonment of the oil blocks, the lack of investment in the field, the colossal losses to the Nigerian economy by the actions of Addax, DPR was right to recommend a revocation of the mining leases issued to Addax in the national interest. Those who have contrary interest can pursue their interest without destroying our nations economy.

“Those peddling lies through Sahara reporters are those trying to mislead the Presidency, the $650 million contract referred to by Sahara reporters was a contract awarded to Kaztec by Addax.

“The Sahara reporters story is clearly a misrepresentation of the facts. Nigeria should not be held hostage by any foreign company”.