Nigeria Cancels Crude Oil Deal with Kenya
By Chika Amanze-Nwachuku, 08.27.2007

The Nigerian National Petroleum Corporation (NNPC) has terminated the multi-million dollar crude oil contract it signed with Kenya Ministry of Energy over “ripples” which the lucrative deal was causing between the state-owned National Oil Corporation of Kenya (NOCK) and the Kenya Energy Ministry.
THISDAY learnt that under the deal sealed by the parties in 1999, NNPC had been supplying Kenya with crude oil at below-market prices, which was then being sold on Kenya's behalf by international oil traders, who remitted the money to Kenya.
Sources said sequel to a visit to Nigeria in 2003 by Kenyan President, Mwaki Kibaki, NNPC and NOCK had executed a one-year contract for the sale and purchase of 30,000 barrels per day (bpd).
The contract was said to have been further extended after a meeting between NOCK and  NNPC, after which the Kenya Energy Ministry directed NOCK to move quickly to contract a new trader.
It was learnt that when the deal was due for renewal early this year, NOCK had put out an international tender inviting bids from crude oil traders to lift the cargo from Nigeria on Kenya Government's behalf, only to be ordered a week later by the ministry of energy to discontinue the procurement immediately, a development which led to the cancellation of the tender quietly.
The grouse of Kenya Ministry of Energy, THISDAY gathered, was that the state oil corporation introduced some terms that were biased against some potential traders.
The tender was said to have been crafted to eliminate competition, as a clause therein stipulated that international traders with outstanding litigation against the corporation would suffer a 35 per cent penalty at the evaluation stage.
Consequently, the ministry was said to have taken over the management of the tender, a development which pitched it against NOCK.
When contacted, NNPC’s Group General Manager, Public Affairs, Dr. Levi Ajuonuma, denied any report of irregularities in the crude oil deal and maintained that the contract was “very legal”.
Ajuonuma, who also denied that NNPC supplied the product to Kenya at below market prices, argued that Nigeria crude oil price was always higher.
“Our prices are never below international market prices. We have never supplied to them below market prices. Our prices are even higher. Sometimes, they (Kenya) lose and at other times, they gain. That is how the market is,” he said.
He also confirmed that the contract was renewed over the years, but that it has been stopped.
The NNPC spokesman who would not disclose why the corporation backed out of the eight-year-old deal, simply said “the contract has been stopped. It has expired.”
On the crisis rocking the Kenya Government over the crude deal, Ajuonuma said it had nothing to do with the NNPC.
“If they have any problem, it is with their own dealers and not with us”, as according to him, Kenya Government does not lift or sell the product by itself but through its oil corporation (NOCK), which he said, lifts the cargo and gives it to those that will sell and then remit the money to the government.
Government-to-government crude contracts were introduced in 1999 after former president Olusegun Obasanjo cancelled the Nigeria 's 41 existing oil marketing contracts as part of his anti-corruption war.
It was learnt that the battle for control of the Nigerian crude lifting tender in Kenya has come at a time when the operations of trading companies contracted to lift crude on behalf of African governments in Nigeria have been in the spotlight following allegations of unscrupulous dealings between the trading companies and powerbrokers.
“There have been several instances when well-connected individuals were found to have colluded with the traders to channel proceeds from the lucrative deals elsewhere, or converted the money to private use,’’ said a report which cited the management of the government-to-government contract between the South Africa and Nigeria as a case in point.
In 2003, the South African press had carried stories alleging that proceeds from a similar contract, secured with President Thabo Mbeki's help in 1999, had been diverted to an off-shore company, with no benefit to the government or the public.
It was then alleged that top government officials and powerbrokers had quietly incorporated a private company in the Cayman Islands called the South African Oil Company to receive the proceeds from the Nigerian contract. At the same time, a company named South Africa Oil was registered in Pretoria.

http://www.thisdayonline.com/nview.php?id=87468

I saw this article a few minutes ago.
So we are doing this much for other Africans, and we are still not regarded as giant. 
Only God knows what else is going on, our governement don't talk to us about this kind of thing.