Presidency Speaks On $25 Billion NNPC Contract

Following claims on social and traditional media that $25B worth of oil contracts were awarded by the NNPC, or that $25BN in NNPC funds is missing, the presidency has spoken concerning the allegation.

Addressing the issue, the Senior Special Assistant to the President on Media and Publicity, Office of the Vice President, Mr. Laolu Akande, has said that no contracts were procured by the NNPC based on the leaked memo of the Petroleum Resources Minister of State, even though such impressions have been created.

While responding to media inquiries Sunday on the matter, Akande disclosed that a closer look at each of the said projects indicate clearly that “these are not procurement contracts.”

Akande said, “When I tweeted on Thursday morning last week, I had indicated that the Vice President, while acting as President approved Joint Venture Financing arrangements. But for some curious reasons, a few media reports used that tweet to report that I said the then Acting President approved N640 Billion worth of oil contracts. Such reporting is both false and misleading and therefore ought to be completely ignored by all seekers of truth.”

“When you look diligently at the referenced projects/transactions one by one, you will see, as NNPC has shown, that none of them was actually a procurement contract.”

“Take both the Crude Term Contract and the Direct Sale, Direct Purchase (DSDP) agreements for instance, these are not procurement contracts involving the expenditure of public funds. Both transactions are simply a shortlisting process, in which prospective off-takers of crude oil and suppliers of petroleum are selected under agreed terms, and in accordance with due process.”

“It is therefore wrong and misleading to refer to them as though they’re contracts involving the expenditure of NNPC funds, or public funds of any sort. As you now know, the Honorable Minister of Petroleum Resources himself has in fact clarified that he meant to focus on administrative and governance issues, not red-flag any fraud – because no fraud exists in this matter.”

“Attaching monetary values to these contracts is an arbitrary act that completely distorts understanding of the situation.”

“Whenever there is a monetary value on any consignment of crude oil lifted in this country by any firm, the proceeds go directly to the Federation Account and not to any company. In fact, the Buhari administration in the implementation of the TSA has closed down multiple NNPC accounts in order to promote transparency and probity.”

“There were public placements of advert in the mass media seeking Expressions of Interest (EoI). Bids were publicly opened in the presence of NEITI, DPR, BPP, Civil Society groups and the press. In some cases even, these events were televised live.”

“For the sake of emphasis let me state clearly that both the Crude Term Contract and the Direct Sale and Direct Purchase agreements are not contracts for any procurement of goods, works or services, and therefore do not involve the use of public funds. Instead, they are simply a shortlisting of off-takers. And unlike what has been reported in the media so far, it is important to set the records straight that the list of approved off-takers does not carry any financial values but simply states the terms and conditions for the lifting and supply of petroleum products.”

He also disclosed that the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline Contract “is a contractor-financed contract which has not yet been finalized or awarded; it is still making its way to the Federal Executive Council, FEC.”

Lastly, on the NPDC, he said there is no contract in the $3BN to $4BN range as reported in the media.

Akande said, “You can then see from the foregoing that the $25BN being bandied in the media does not exist. There is no $25BN missing

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