Odinkalu, Falana, others ask EFCC to act on reports on fraud in Nigeria’s petroleum industry

The lawyers say little or no action has been taken on the reports’ findings since they were submitted to Mr. Jonathan in 2012.

A group of lawyers and civil society advocates under the banner of ‘The Oil Probe Follow-up Group’ has called on the Economic and Financial Crimes Commission, EFCC, to investigate the allegations of fraud detailed by the two committees set up by President Goodluck Jonathan in the wake of the 2012 fuel subsidy crisis.

The group in two petitions – one for each of the committee’s report – to Ibrahim Lamorde, the EFCC Chairman, noted that little or no action has been taken on the reports’ findings since they were submitted to Mr. Jonathan in 2012.

Some of the members of the group include Chidi Odinkalu, Chairman of Nigerian Human Rights Commission; Femi Falana, a Senior Advocate of Nigeria; Adetokunbo Mumuni of Social Economic Right Accountability Project; Olanrewaju Suraj of Human and Environmental Development Agenda; and Jiti Ogunye, a Lagos-based lawyer.

“The project is conceived against the background that Nigeria and its citizens are endangered because the oil and gas sector which is currently the country’s major income stay is enmeshed in a potpourri of scams,” said Motunrayo Alaka, Co-ordinator at the Wole Soyinka Centre for Investigative Journalism, who is collaborating with the group.

“Despite reports from many government-initiated oil probe panels, especially in 2012, confirming mind boggling fraud in the sector, the government is yet to take commensurate steps to address the situation,” Mrs. Alaka added.

Report of the petroleum revenue special task force.

On February 8, 2012, Diezani Alison-Madueke, the Petroleum Minister, inaugurated the Petroleum Revenue Special Task Force headed by Nuhu Ribadu, a former EFCC boss.

Six months later, the committee submitted its findings to President Jonathan, detailing gross allegations of official fraud and corruption in the oil industry.

The group, among other things in the report, urged the EFCC to investigate the Nigerian National Petroleum Corporation’s, NNPC, alleged failure to use prevailing CBN exchange rates for calculating the value of crude oil sold to its refineries.

“That you investigate all relevant circumstances surrounding the alleged non-payment of a reported $167 million in oil block signature bonuses by concessionaires.

“That you investigate all relevant circumstances surrounding the Department of Petroleum Resources’ alleged failure to collect a reported $2.9 million worth of concession rentals.

“That you investigate all relevant circumstances surrounding the alleged non-payment of a reported $3.027 billion in royalties on crude oil and gas produced by named operators, including the alleged $1.5 billion in outstanding royalties owed by Addax Petroleum,” the group stated.

The group further urged the anti-graft agency to investigate the DPR’s alleged failure to collect amounts due to the nation as gas flare penalties; commodities-trading firms lifting NNPC crude oil without having executed term lifting contracts in place; and SNEPCO’s alleged non-remittance of N137.572 billion in gas sale proceeds from the Bonga concession.

The technical committee on payment of fuel subsidies

In the same February 2012, Ngozi Okonjo-Iweala, Nigeria’s Finance Minister, chaired a stakeholders’ meeting of the downstream petroleum sector which led to the establishment of the Technical Committee on Payment of Fuel Subsidies.

The Committee, headed by Aigboje Aig-Imokhuede, submitted the report of its findings and recommendations to the President in July 2012.

In its report, the committee noted, among others, that over N400 billion was paid as subsidy in 2012 to fake petroleum marketers; there was an excess payment of N14 billion as bank spread from defaulting marketing and trading companies; and ineligible oil marketing and trading companies were allowed to participate in the subsidy process.

The group’s petition to the EFCC urged the commission to further investigate all the companies mentioned in the report and prosecute defaulting directors and officers, as well as the PPPRA officials responsible for the lapses in the subsidy administration process.

The group also called for the investigation of the N331 billion worth of kerosene subsidy payments made between June and December 2011 and prosecute those involved in criminal acts.