Welcome, Guest: Register On Nairaland / LOGIN! / Trending / Recent / New
Stats: 3,143,156 members, 7,780,115 topics. Date: Thursday, 28 March 2024 at 09:50 AM

Exclusive: Nigeria Loses Billions In Cut Price Oil Deals - Ribadu Report - Politics - Nairaland

Nairaland Forum / Nairaland / General / Politics / Exclusive: Nigeria Loses Billions In Cut Price Oil Deals - Ribadu Report (1245 Views)

Presidency Intensifies Efforts To Discredit Ribadu Report. / Ribadu Report: Sack, Prosecute Oil Minister — Labour, SNG, Others / Ribadu Report, Plan To Embarrass Government - Presidency (2) (3) (4)

(1) (Reply) (Go Down)

Exclusive: Nigeria Loses Billions In Cut Price Oil Deals - Ribadu Report by Nobody: 5:07pm On Oct 24, 2012
By Joe Brock
ABUJA (Reuters) - Nigeria lost out on tens of billions of dollars in oil and gas revenues over the last decade from cut price deals struck between multinational oil companies and government officials, a confidential report seen by Reuters says.

A team headed by the former head of the anti-corruption agency Nuhu Ribadu produced the 146-page study on an oil ministry request. It covers the year 2002 to the present.

Nigeria is Africa's largest crude oil exporter, shipping more than 2 million barrels per day (bpd), and is also home to the world's ninth biggest gas reserves and one of its largest Liquefied Natural Gas (LNG) export terminals.

The report provides new details on Nigeria's long history of corruption in the oil sector, which has enriched its elite and provided the oil majors with hefty profits while two thirds of people live in poverty.

Oil Minister Diezani Alison-Madueke told Reuters on Tuesday she had received the report last month but that it was a draft and the government was still supposed to give input. The one seen by Reuters was labeled "Final Report."

The report concluded that oil majors Shell, Total and Eni made bumper profits from cut-price gas, while Nigerian oil ministers handed out licenses at their own discretion. This, while not illegal, did not follow best practice of using open bids. Hundreds of millions of dollars in signature bonuses on those deals were also missing, it said.

"We have not seen this report and are, therefore, unable to comment on the content, but we will study it if and when it is published," a Shell spokesman said.

The report alleges international oil traders sometimes buy crude without any formal contracts, and the state oil firm had short-changed the Nigerian treasury billions over the last 10 years by selling crude oil and gas to itself below market rates.

There was no suggestion that the oil majors or traders had done anything illegal, but the report highlighted a lack of transparency in their dealings in a nation rife with graft.

"It is a draft," Alison-Madueke said. "There will be some areas where the government ... may have a slightly different opinion ... (and) will put its point of view to the committee."

She said she expects the final report to be with President Goodluck Jonathan within two weeks.

MISSING BILLIONS
Ribadu's probe was among several set up following a week of nationwide strikes against a rise in fuel prices in January, which morphed into a campaign against oil corruption.

Billions of dollars of revenue was missing in unpaid debts from signature bonuses and royalties, the report found.

Nigeria LNG, a company jointly owned by the NNPC, Shell, Total and Eni had paid the country for gas at cut-down prices before exporting it to international markets, the report said.

Total and Eni declined to comment because they invest in but do not operate Nigeria LNG, the role played by Shell.

"The estimated cumulative of the deficit between value obtainable on the international market and what is currently being obtained from NLNG, over the 10 year period, amounts to approximately $29 billion," the report said.
It also said foreign oil firms had outstanding debts.

Addax, now a unit of China's state-owned Sinopec, owes Nigeria $1.5 billion in unpaid royalties, part of a $3 billion black hole of unpaid bonuses and royalties owed by oil firms.

Addax did not respond to requests for comment, but the report noted it disputes owing the signature bonuses.

Shell owes Nigeria's government 137.57 billion naira ($874 million) for gas sold from its Bonga deep offshore field, the report said, while oil majors owed $58 million between them for gas flaring penalties. They were also not adhering to newer higher fines.


The probe also said Nigeria was the only nation to sell all its crude through international oil traders rather than directly to refineries, adding that such trades were often opaque.

INFORMAL TRADING
It said some international oil traders who were not "on the approved master list of customers" had been sold crude oil "without a formal contract" so little could be obtained about the details of these deals, which can be worth hundreds of millions of dollars.

"This logically will serve to reduce margins obtainable on sale of crude oil," the report said.


But Alison-Madueke disputed this, saying there are no informal contracts and there is "an official tender put out every year", which can be seen by the public in newspapers.

The state oil firm gets an allocation of 445,000 bpd of crude oil to refine locally but it has been selling itself this oil at cut-down prices, a practice which cost Nigeria $5 billion in potential revenue between 2002-2011, the report said.

"NNPC buys at international rates," Alison-Madueke retorted.

The report said the NNPC made 86.6 billion naira over the 10-year period by using overly generous exchange rates in its declarations to the government. There was no sign of the money.

Nigerian oil ministers between 2008-2011 handed out seven discretionary licenses but there is $183 million in signature bonuses missing from the deals, the report said. Three of these oil licenses were awarded since Alison-Madueke took up her position in 2010, according to the report.

"I have not given any discretionary awards during this administration," Alison-Madueke told Reuters, although she added that the president had the right to do so instead of using bids if he saw fit. "That is entirely up to him," she said.

Among the report's recommendations were that parts of NNPC be reorganized or scrapped, an independent review of the use of traders be set up and a transparency law be passed requiring oil companies to disclose all payments made to Nigeria.

U.S. regulators put new rules in place in August that will require U.S.-listed oil and gas companies to disclose payments they make to foreign governments like Nigeria.
(Additional reporting by Muriel Boselli in Paris, Stephen Jewkes in Milan and Emma Farge in Geneva; editing by Tim Cocks and James Jukwey)
Source
Re: Exclusive: Nigeria Loses Billions In Cut Price Oil Deals - Ribadu Report by Horus(m): 6:43pm On Oct 24, 2012
And where are the missing Billions now?
Re: Exclusive: Nigeria Loses Billions In Cut Price Oil Deals - Ribadu Report by Nobody: 9:58pm On Oct 24, 2012
Nigerian oil ministers between 2008-2011 handed out seven discretionary licences but there is $183 million in signature bonuses missing from the deals, the report said. Three of these oil licences were awarded since Alison-Madueke took up her position in 2010, according to the report.

"I have not given any discretionary awards during this administration," Alison-Madueke told Reuters, although she added that the president had the right to do so instead of using bids if he saw fit. "That is entirely up to him," she said.

I'd say one of the licenses mentioned here went to the Dame herself, Madam First Lady!
After all, it is common knowledge that Bola Shagaya is merely a front.




Recently, the federal government awarded oil block licences to no fewer than 21 indigenous companies to prospect for oil. LEADERSHIP SUNDAY can now authoritatively reveal the identities of some of these awardees.

Investigations carried out by LEADERSHIP SUNDAY reveal that the promoters of these registered companies include multi-billionaire Hajiya Bola Shagaya, former group managing director of the Nigerian National Petroleum Corporation (NNPC) Mr. Funsho Kupolokun, former governor of Delta State Olorogun Felix Ibru and Chief Odunsi Adedeji.

Hajiya Bola Shagaya, who was recently listed by an international magazine as one of the 10 richest women in Africa, is one of the two directors of Voyage Oil and Gas Limited, one of the indigenous companies that were awarded oil block licences.

Hajiya Shagaya is very close to Dame Patience Jonathan, the president’s wife.

Voyage Oil and Gas Limited was incorporated on October 14, 2011, with a nominal share capital of two million shares. The incorporation number is RC 986771. Out of the two million shares, Shagaya owns one million, while the remaining one million is owned by Oba Tonye, the only other shareholder.

Listed as directors in Form CO7 are Oba Tonye and Hajiya Bola Shagaya.

Source
Re: Exclusive: Nigeria Loses Billions In Cut Price Oil Deals - Ribadu Report by Wadeoye(m): 7:19am On Oct 25, 2012
We know this already. What we want is names of people involved and how much they have stolen so far.
Re: Exclusive: Nigeria Loses Billions In Cut Price Oil Deals - Ribadu Report by Nobody: 9:39am On Oct 25, 2012
Wadeoye: We know this already. What we want is names of people involved and how much they have stolen so far.

What we need is for Mr President to grow a spine and order the prosecution of all those who stand accused.

(1) (Reply)

Breaking News: Jesse Community On Fire Monarch’s Palace Razed 10 Dead / Fire Guts Obasanjos Hilltop Residence (photos)Update(how it started) / The Vice President’s Official Residence

(Go Up)

Sections: politics (1) business autos (1) jobs (1) career education (1) romance computers phones travel sports fashion health
religion celebs tv-movies music-radio literature webmasters programming techmarket

Links: (1) (2) (3) (4) (5) (6) (7) (8) (9) (10)

Nairaland - Copyright © 2005 - 2024 Oluwaseun Osewa. All rights reserved. See How To Advertise. 30
Disclaimer: Every Nairaland member is solely responsible for anything that he/she posts or uploads on Nairaland.