INVESTIGATION: Nigerian government awarded N690m Ogoni cleanup contracts to unqualified firms

Contaminated Farmland at K-Dere, Ogoni land
Contaminated Farmland at K-Dere, Ogoni land

Fresh facts have emerged on how the Federal Ministry of Environment awarded consultancy contracts worth N690 million to two unqualified companies in the ongoing remediation of hydrocarbon pollution in Ogoniland.

The two firms were among the three consultants engaged by the ministry on behalf of the Hydrocarbon Pollution Restoration Project (HYPREP), the body responsible for coordinating the cleanup.

The companies – Messrs. Alliance Boots Limited, and Foxtrot O & G Company Nigeria Limited – were awarded contracts for communication and public relations, and monitoring and evaluation processes, respectively, despite being unregistered for those tasks, in clear violation of Nigeria’s procurement legislation.

The former was awarded the contract for N182,721,000 while the latter was N507,299,000, making a total of N690,020,000.

The third contractor, a joint venture of Eco Project Services, Nuks Associates Limited and AG Partnership Limited, was awarded at the rate of N968,119,275.08. The contracts which were awarded for a two-year period, are renewable after expiration.

The consultancy project award has been described by some stakeholders as “food for the boys,” even as they accused the ministry of ‘hijacking’ HYPREP’s responsibility of awarding contracts for selfish gains.

The two companies involved in this new round of project ‘bazaar’ are aside from the 11 unqualified firms that were awarded the remediation contracts by HYPREP.

The Ministry of Environment and HYPREP have, however, denied any wrongdoing in the award of the contracts.

Similarly, when asked to comment about the latest discovery, the ministry again insisted that due processes were adhered to in the engagement of the consultants.

In a letter signed by the director of procurement, Owoicho Ugbaha, the ministry noted that the consultants were selected based on their expertise.

But contrary to Mr Ugbaha’s claim, a review of the registration details of Alliance Boots Limited, and Foxtrot O & G Company Nigeria Limited with the Corporate Affairs Commission (CAC) revealed that the duo were not registered for the tasks they were contracted to do.

For instance, Alliance Boots Limited was awarded the contract of communication and public relations, but the company’s objective stated in its memorandum of article revealed that it was set up “to carry on the business of seeking, securing, negotiating and finalising contracts on behalf of its clients and provide general agency and representation services to its clients and to carry on the business of information technology, data capturing and verification of data.”

Similarly, Foxtrot O & G Company Nigeria Limited, awarded a contract for monitoring and evaluation, was set up to provide logistics and transportation services. Its objective stated with the CAC reads: “to provide logistics services in the area of clearing and forwarding services, general maritime services, freight forwarding agency, vessel handling agency, warehousing and distribution and transportation, dredging activities etc.”

BPP issues certificates of “no objection”

Despite the firms not being qualified based on their stated objectives, the Bureau of Public Procurement (BPP), the agency saddled with the responsibility of regulating procurement processes, issued a “certificate of no objection,” to the ministry to engage the contractors.

Instead of the BPP to scrutinise the eligibility of the companies to undertake the contracts, it reduced the total contract sum from N2.04 billion proposed by the ministry to N1.658 billion. Alliance Boots Limited’s contract sum of N191,192,063,83 submitted to BPP was reduced to N182,721,000 while N852,007,016.00 approved by the ministry for Messrs Foxtrot O & G Nigeria Limited was reduced to N507,299,000. The joint venture of Eco Project Services, Nuks Associates Limited and AG Partnership Limited had its approved contract sum of N1,002,976,983,42 reduced to N968,119,275.08. The agency said its efforts saved government N388,036,788.17.

The BPP defended its action, saying it acted within the law establishing it and the responsibilities it is saddled with.

More than two months after PREMIUM TIMES’ request for clarification on the matter, BPP’s director-general, Mamman Ahmadu, said memoranda of article were not part of the criteria requested by the contract awarding ministry from the contractors.

According to Mr Ahmadu, his agency strictly worked on the criteria set by the ministry in the advertisement placed in the dailies, and that it lacked the power to alter the conditions set by the awarding agencies or ministries.

“Premium Times may wish to note that Due Process Certificate of “No Objection” was issued by the Bureau after a review of the evaluation exercise carried out by the Federal Ministry of Environment, which was based on qualification criteria published in the Federal Tenders Journal of Monday, January 9 – Sunday, January 22, 2017 and two (2) National dailies (Thisday and The Nation Newspapers) of Monday January 2, 2017. This procedure is in line with Sections 23 (1) of the Public Procurement Act (PPA), 2007, which places the responsibility of setting evaluation criteria to a procuring entity. It is instructive to note that the Memorandum of Article, which contains the information Premium Times made reference to, was not among the documents that bidders were requested to submit and cannot, therefore, form a basis for evaluating their qualification,” the letter read in part.

Mr Ahmadu said by law, “the criteria stipulated as the basis upon which suppliers or contractors are evaluated cannot be changed in the course of any procurement proceeding and that the burden of proving fulfilment of the requirements for participation in any procurement proceeding lies on the supplier, contractor, consultant or service provider.”

He said apart from submitting documents proving their competence, the three companies were the lowest evaluated responsive bidders in the respective procurements.

Corporate Affairs Commission counters BPP

However, the head of public affairs unit of the corporate affairs commission (CAC), Moses Adaguusu, told PREMIUM TIMES that the CAC does not recognise any contract awarded to a company outside its area of competence, and any legal matter brought up against such company can always be won by the plaintiff, especially if such plaintiff has suffered damages as a result of the action.

“On this particular Ogoni cleanup case, we may not be able to speak. However, one thing we are sure of is that objects of companies are written based on the relevant documents provided by the owners indicating their competences.

“So, if anyone runs a business contrary to the objects, CAC cannot intervene because the contract is between the company and its employer. If CAC is now needed to supply relevant documents in a court of law, it would do. Such contracts are usually illegal.”

Legal experts corroborate CAC

Human rights lawyer, Jiti Ogunye, strongly condemned contracts awarded to companies with unrelated objects. He added that the law does not even recognise partnership with competent companies as reasons for such awards, saying such actions fall short of procurement laws.

Mr Ogunye said partnerships do not transfer competence to incompetent companies. “On this basis, whatever contractual arrangements exist between the ministry and the concerned companies are illegal.”

“They are illegal because in the bid, what were the requirements? How did they demonstrate capacities? How did they show that those were their core objects, let alone demonstrating their track records? If your incorporation documents run contrary to the jobs that you pursue, it is an illegal contract. How can lawyers be doing the job of doctors? In short, it is a mockery of award of contracts. They are illegal contracts.

“Before you can enter into any partnership with either local or foreign companies, your core objects must be in the line of the businesses you have taken contracts. If not, such contract is illegal before the law. They are fundamental misrepresentation.”

Speaking at a training on illicit financial flows in Abuja, a lawyer and rights activist, Nurudeen Ogbara, said some contractors sometimes put ‘general businesses’ in their article of memorandum to justify their bidding for contracts outside their areas of competences. He said this practice was a improper.

He said; “That ‘general business’ clause is being misinterpreted. By law, that clause simply means other businesses in their listed areas core competences. Once the general businesses clause is not in line with the core objects listed, then it is fraudulent, questionable and a clear violation of the Procurement Act. In fact, such a contract is illegal.”

Contractor ‘sublets’ contract

When told that his company’s stated object with the CAC meant it was not qualified to bid for such HYPREP projects, Solomon Okezie, managing director of Alliance Boots, simply insisted that his company had the expertise to handle the project.

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Also, contrary to paragraph three of the contract award letter, which warns against transfer of contract and request for variation, Alliance Boots which won the contract for the media and public relations, reportedly ‘engaged’ the services of a Port Harcourt-based media organisation, Nevido Media, to execute the contract.

But Mr Okezie said his company did not engage Nevido Media Limited. Rather, he said his firm only employed Nevido Media’s chief executive officer, Vivien Douglas.

He said he angaged Ms Douglas due his company’s poor footing in Port Harcourt, Rivers State capital.

But Ms Douglas has consistently countered Mr Okezie, saying her company was engaged for N33 million to carry out the task of publicity for the cleanup exercise.

Ms Douglas said her company was consulted for a communication and media consultancy job in April, 2018.

“My company was contracted to set up a media office and draw up a timeline for workplan. On May 8, 2018, Nevido Media was invited to Abuja by Alliance Boots Limited to finalise the contractual process. On May 9, we met with my company’s guarantor, a member of the House of Representatives, who filled the guarantor form that was provided.

“On May 10, we finalised on costing and myself and the Alliance Boots Limited MD signed a two-year contract of N33 million. The cost entails N12 million and the total cost for task delivery while N21 million was for the consultancy services at N1 million per month, beginning from April 2018 to December 2019.”

Ms Douglas said Alliance Boots Limited took the two copies of the agreement for notary with a pledge to send her a copy as soon as completed.

“But when I kept asking for a copy without response, I suspected foul play. They claimed they wouldn’t want the agreement to be everywhere. At this point, they had already paid N3.7million into Nevido media’s corporate account, being cost for two quarters of task delivery,” she added.

Ms. Douglas said she had kicked off the assignment with a two-day retreat for consultants and HYPREP unit heads, which she noted held at the Presidential Hotel in Port Harcourt.

But Mr Okezie told this newspaper that his company only hired Ms Douglas to set up the Port Harcourt office since it never had office in the city.

He said; “Let her produce the letter of engagement our company issued to her if her claim is true. We only thought we could help her but she insulted the management and got fired. That I transferred money to her corporate account does not make me liable in anyway.”

He said he had reported the matter at the Force Headquarters and that Ms Douglas must pay money owed to his company, claiming she did not render the service she was paid for.

Foxtrot Company keeps mum

When reached for comment about the eligibility of his company for the consultancy job it was awarded, the chief executive officer Foxtrot O&G Company Nigeria Limited, Uche Anidobi, declined to speak.

But Mr Anidobi had earlier admitted to owning the company in a telephone interview with this reporter. He also confirmed that the company won the consultancy job but terminated the call abruptly when this reporter asked him about the eligibility of his firm to undertake the contract. He subsequently refused to pick several calls put through to his line and did not reply messages sent to him on WhatsApp and as SMS.

Procurement expert alleges fraud

A project and procurement consultant, Tony Osborg, who claimed to have actively participated in the Ogoni cleanup procurement processes, has described the whole process as a charade. He said the process was fraught with irregularities and that political influence and monetary power were all required to win contracts.

He said; “First, if you look at the publication for invitation for pre-qualification, you would see the technical requirement to be shortlisted for the tender proper. This is all you need to see how flawed the process was. If you take a look at the list of 183 prequalified contractors for the remediation project proper, and you conduct a background check, many of them would not have scaled through the pre-qualification stage because they had no experience.

“It was at the stage when too much of political and monetary influence came in that a lot of the foreign companies began to pull out of the process.

“Another interesting point of note is that the criteria adopted in evaluating the commercial bid remains a mystery. It was obviously not a ‘lowest bidder wins.’ We saw companies with the highest quotation winning some lots while those with lower quotation but technically competent were disqualified. We saw contractors being awarded contracts at a higher rate for a smaller quantity. At the end of the day, one point became obvious, you needed a political contact to win a lot, not competence.”

Ogoni youths kick, seeks international interventions

Irked by what it described as the abandonment of UNEP recommendations and the alleged fraudulent practices in the execution of the remediation project, a group of youth based in the Niger-Delta region, has petitioned international communities including President Donald Trump of United States, seeking intervention.

Under the platform of Ogoni Youth Federation, the youth said it had instituted civil action against the ministry of environment and HYPREP at the Federal High Court in Port Harcourt, Rivers State, in a suit number; FHC/PHC/122/2018.

The petition, a copy of which was made available to PREMIUM TIMES, was signed by its national president and secretary, Yamaabana Legborsi and Ntormabari Mesua, respectively.

The statement reads in part; “In the light of the foregoing, believing that the cleanup exercise is a genuine effort at addressing the age-long environmental degradation of our land, and not a mere political biII-boarding, we therefore call on the United States through your good office to exert an unwinking surveillance on the activities of HYPREP to save Ogoni from another round of crisis which is imminent and to ensure that the project is not delivered dead on arrival, as the people are already jilted and may be forced to revolt! The suffering of our people can no longer be exploited by some opportunists and experts in strategic deception whose prime interest is the appropriation of funds meant for the cleanup exercise. Please stand with us and with the good people of Niger Delta in this trying time.”

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