Published On: Tue, Apr 5th, 2016

How Buhari’s Oil Minister Ran NNPC Into Troubled Water, Plus His Expensive Lifestyle

Share This
Tags

By Sadiq Umar – His appointments, first as Group Managing Director of the Nigerian National Petroleum Corporation (NNPC) and subsequent elevation as Minister of State for Petroleum elicited relief and hope. Especially for the masses of Nigerian who have remained the unfortunate victims of inefficiency and corruption that have characterized the activities of the Corporation over the years.

Nigeria's minister of state for Petroleum

Nigeria’s minister of state for Petroleum

And like a man with a sense of mission, Ibe Kachickwu, Nigeria’s Minister of State Petroleum swung into action, unfolding populist reforms that further ignited sweet anticipation of a new dawn for the people. September, 2015, NNPC engaged an international accounting firm to ascertain the exact amount due to government on the Strategic Alliance Contracts entered by Nigerian Petroleum Development Company, where up to $2.46bn of government money was to be recovered.

In a report submitted to Buhari by its new management, detailing the corporation’s early successes, the Group Managing Director of the NNPC, Dr. Ibe Kachikwu, revealed that the firm had commenced performance measurement and benchmarking. He added that the corporation had also started what it described as Value for Money Review of NNPC and the JV companies covering the period of 2008 to 2013. The NNPC report, according to a statement by the Presidency, indicated that the new measures might lead to further cost recovery for the firm.

The report also revealed that after an extensive investigation of the various toxic crude oil for refined products swap contracts, a total sum of $420m had so far been reconciled in favour of NNPC and was now due for recovery from the legacy OPA/SWAP contracts. “Out of the reconciled amount, the sum of $277m had been recovered in lieu of products and the recovery effort is still ongoing,” Kachikwu then assured the nation of his commitment to the continued review of all existing contracts and addressing the ones that were not favourable to the corporation.

The NNPC boss said the six directorate within the corporation is too large and impliedly expensive for the corporation. Consequently, it was reduced from six to four with the directors shown the way out. He promised cost reductions to ensure that the corporation remained profitable in the prevailing low crude oil price regime, while assuring of monthly publication of corporation’s account as a measure to promote transparency.

However, recent developments have put to question the sincerity of not just Kachikwu but by extension, that of President Muhammadu Buhari, the man at the helms of affairs at the Petroleum industry.

For instance, the directorates within the corporation have since increased from four to seven following the unbundling carried out by the regime.

Another worrisome discovery is the contract appointing Messrs UTM Offshore Limited and five others for surveillance and security of pipelines. Contract given to private security outfits can only be carried out with the involvement of security task force comprising of soldiers. President Buhari had earlier directed the military to take over the security of oil installations including pipeline surveillance. The arrangement where NNPC awards security of oil installations to private guards at a huge cost and whereby the private outfit would still have to enlist the protection of the military is ineffectively and expensive. The President’s directive was therefore in tune with the need to guarantee efficiency at minimal cost. The advantage of using the Army are two folds; minimal cost and speed of delivery.

Hence, contracts hitherto given to private concerns and ex-militant organizations like OPC and those of Tompolo by the last administration were all determined. Indeed, the military have been involved in securing the pipelines in recent times. The Sappers Engineering Nigeria Limited, an engineering corp of the Nigerian Army, since 2010 till date have carried out the clearing of pipeline route from Warri – Escravos, Port Harcourt – Aba, Warri – Benin, Monsinmi – Atlas Cove, Monsinmi – Ibadan and Benin to Suleja. Before then, some of it have not been cleared for over 30 years.

Now, Nigerians continue to groan under the hardship of fuel scarcity, foreign exchange imbroglio, power crisis, Nigerian government officials, including ministers live a lavish expensive lifestyle  within and outside the country.

Although, there has been a denial, Kachikwu’s recent comments when he gave May time lag for the resolution of the lingering fuel crisis, is believed to be the primary reason for the aggravated fuel scarcity across the nation.

On a recent official visit to the United Arab Emirate, the flamboyant Minister of state for Petroleum, Ibe Kachukwu stayed at the Burj Al Arab hotel, “the world’s only seven-star hotel”, based in Dubai.

The hotel stands on an artificial island on top of water and the cheapest room cost about N1.2M per night. When our new spondent called the hotel, it was confirmed the minister stayed in the Hotel.

Kachikwu, who also doubles as the GMD NNPC earlier in December held a thanksgiving ceremony in Delta state with his governor Senator Ifeanyi Okowa, PDP,  leading other governors and top government functionaries to attend the thanksgiving service held at the All Saints Catholic Church, Onicha Ugbo, Aniocha North local government area of the state with a lavish reception at his mansion at Onicha Ugbo.

The Asaba airport was clogged with private planes of guests, captains of industries, politicians and some government officials with about 20 planes parked at the small airport. The situation at the airport was very chaotic that the Benin airport was used as parking bay.

Also Kachikwu, known for living large has a newly built Helipad in his expansive country home in Onicha Ugbo. Recently, he flew on a chopper from his home on Christmas day to the Asaba airport a journey of less than 15 minutes drive en route to Kaduna state to inspect the refineries.

It is also worrisome that Kachikwu like the former minister of petroleum resources Diezani Alison-Madueke has been flying in chartered private jets since assumption of office.

The lifestyle of Kachikwu further sums the tragedy of resource-rich African countries where the leaders spend millions on luxury items, as the ordinary people live in abject poverty, lacking access to basic amenities and services such as clean drinking water, healthcare and education.

Kachikwu who has two wives has approved SA’s for them in addition to dozens of special advisers he has employed. Checks at the NNPC towers indicate that he also has a staff for the purpose of bringing his lunch and breakfast.

He has also employed a Chief of Staff which is unprecedented in the ministry as no minister or GMD in the past has employed or appointed a chief of staff, rather they have what is called STA’s Senior Technical Assistant who is normally picked from experienced staff of the ministry.

The appointment of this Lady Chief of Staff is causing ripples in the ministry as she calls the shot, runs the whole show, controlling and issuing directives to Group Executive Directors, GED’s that have spent over twenty years of experience in the industry.

Industry’s stakeholders said Kachukwu, who has been under fire over the ongoing fuel crisis, wondered how the minister  would be able to regulate the industry as corrupt oil and subsidy thieves continue to allegedly oil his ridiculously expensive lifestyle.

To be continued…

 

About the Author

Leave a comment

XHTML: You can use these html tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>