Monday, March 20, 2017 09.19AM / TheWill
The Nigerian National Petroleum Corporation (NNPC) Friday said it will go after Capital Oil % Gas Limited for criminally diverting 100 million litres of petrol belonging to the corporation without authorization.
The NNPC said Capital Oil, which is owned by controversial businessman, Mr. Ifeanyi Ubah and another major oil company, MRS Limited, owned by Sayyu Dantata, jointly misappropriated the oil giant’s 130 million litres of premium motor spirit (PMS) stored in depots operated by them in Apapa, Lagos, under a throughput arrangement to ensure a robust strategic reserve.
Henry Ikem-Obih, NNPC chief operating officer, downstream, NNPC, according to a statement by the corporation, told the media that MRS depot stored 30 million litres, while Capital Oil held 100 million litres.
The value of the stolen petrol was put at N17. 439 billion.
“We instructed the Nigerian Products Marketing Company (NPMC) a subsidiary of NNPC, to send additional trucks to those locations to move products for distribution aimed at meeting a supply shortfall we discovered in the market, but after days of not being able to access the terminals we had to take a decision as NNPC management to invite auditors and inspectors to go and do a physical check on the inventories. This was when we discovered that there was no product for NNPC to evacuate from the depots.”
He said the infraction by the two downstream companies was a clear violation of existing throughput contract which prohibits the owners of the facilities from tampering with the volumes in their custody without express permission of the corporation.
“Armed with this information we promptly called them in to explain to us what happened to our product in their custody,” he said.
“After the meeting with them, we issued them with letters and told them in clear terms to do either of two things: return to us the full volume of what has been stored in their depots litre- for- litre or pay the full value of the products they took without our approval.”
Ikem-Obih disclosed that the corporation alerted the Department of State Services (DSS), the Economic and Financial Crime Commission (EFCC) as well as the relevant committees of the national assembly with oversight function on the corporation’s downstream operation to help recover the assets contrary to the insinuation that NNPC kept mute over the infraction until the senate uncovered it.
He said so far, MRS has fully complied by returning the 30 million litres of premium motor spirit (petrol) that it expropriated while the corporation had not achieved much progress with Capital Oil & Gas which was yet to return 82 million litres of petrol, valued at N11 billion, out of over 100 million litres which it took.
Ikem-Obih disclosed that NNPC had set up two committees to evaluate the roles played by some of its staff in the illegal product evacuation and review its entire throughput policy in order to align it with global best practices.
According to him, as part of efforts to forestall a repeat of similar occurrence in the future, a disciplinary committee was already investigating the level of involvement of its staff with a view to applying appropriate sanctions as a deterrence measure.
The second committee, he said, was reviewing the corporation’s policy and guidelines for engaging in throughput arrangements with third parties to establish control measures that could help avert a similar incident in the future.
On possible punitive measures to be meted out to culpable staff and erring firms, Ikem-Obih it would be better to allow the committees decide that in line with existing laws and regulations.
On the impact of the product diversion on the supply system, he said there was no fear of under-supply as the NNPC GMD, Dr. Maikanti Baru, has graciously approved an increase in importation of petrol to make up for the shortfall.
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