Home » News » Diezani Opens Up On Oil Swap Deal

Diezani Opens Up On Oil Swap Deal

Former Petroleum Reosurces Minister Says Crude Oil Swap Policy Initiated By Late Rilwanu Lukman In National Interest
Our Reporter
Former Minister for Petroleum Resources, Mrs. Diezani Alison-Madueke, who is currently undergoing extensive cancer treatment in London, has strongly refuted claims that she gave away $24 billion in oil swap deals without contract.
Speaking in a statement release issued to journalists in Abuja yesterday, Mrs. Alison-Madueke refuted reports, which claimed that she granted an “extension” instead of ‘approval for the renewal of contracts’ for the swap arrangements.
She described the latest attack on her person as “fabricated” and“tissues of lies deviously concocted to sustain the hate narratives” against her person.
Putting facts of the swap deal intoproper perspective, the former minister, who spoke through her spokesman, Mr. Clem Aguiyi, insisted that what she actually gave were approvals for renewal of contract for a one-year term each for both Messrs Trafigura Beheer BV and Messrs Society Ivoirienne de Raffinage (SIR) in August 2010 in the first instance, and later, for a two-year term in August 2011, to same companies.
The NNPC subsidiary, Duke Oil, she said, was also given approval for a one-year term in January 2011.
According to her, two other approvals were consequently sought by the Group Managing Directorof NNPC.
“The first of these on the August 29, 2014 sought to ratify all three aforementioned approvals which had apparently variously expired during the course of 2013”, she stated.
The former minister also stated that in view of the subsisting situation, she “immediately approved/ratified all three renewals which expiry, of those terms, were put at December 31, 2014,” following assurances that the contractual obligations of the parties to NNPC had been fully met, despite regrettable lapse in renewal time.
She further disclosedthat the lapses between expiration and renewal dates were seven months for Duke Oil, 10 months for SIR and 12 Months for Trafigura.
“Secondly, on the 28th of October 2014, following the recommendation of the then GMD, NNPC, the Minister approved OPAs for a new term of two years commencing from January1, 2015. The entities recommended by NNPC were Sahara Energy Resources Ltd, Aiteo Energy and Duke Oil. NNPC strongly recommended and outlined the benefits of the OPA over the SWAPs and put forward the case for migration from the OPA and crude exchange (SWAP) contracts to OPAs fully. NNPC posited that the ‘experienced benefits of the OPA to the Federation’, would be much greater. All approvals were due process driven and were only given by the Minister following formal statutory written requests, which contained the technical basis for the renewal and were sent to the Minister by the GMD-NNPC, as is the normal practice.
“NNPC had clearly requested for the approval of the Minister for “Renewal of the Crude Oil – Refined Products Exchange Agreement” and “Renewal of Offshore Processing Agreement” on all the various occasions. Whereas, it is the Minister’s responsibility to either give or refuse approval, it was not within purview of the minister to draft, initiate or conclude the processes of signing the final contracts as it is the statutory responsibility of NNPC to ensure that all technical areas are duly covered and all requisite due process parameters are duly implemented”, the statement read.
Speaking further, her spokesperson noted that itwas imperative that records are set straight so that Nigerians, and posterity,“will know the truth”.
According to him, “Mr. (Austin) Oniwon was right when he stated that the 445,000 barrels of crude oil were the property of NNPC, bought from the Federal Government of Nigeria at the prevailing rate and therefore as GMD, he did not need the Federal Executive Council or Presidential approval to enter into SWAP arrangements that will enable NNPC fulfill its statutory obligations”.
“It was also correct”, he said, that “contrary to the picture being painted in the media not more than 210,000 bpd out of the 445000 bpd lifted by NNPC, to ensure adequate supply and distribution of petroleum products, were traded under the following SWAP arrangement”.
He put volumes given to the three companies under the agreement as60,000bpd for SIR,60,000bpd for Trafigura and 90,000bpd for Duke Oil adding that what the GMD required to execute the above was statutory approval from the minister.
The statement also disclosed that refineries were chosen by NNPC to participate in the SWAP arrangement as outlined in Section 4 of the Petroleum Act and Section 20 of the NNPCAct:
“It is however incorrect to say that the former minister gave ‘Approval for Extension’ unless ‘extension’ can legally be substituted for “renewal” because what the minister gave (and the records are there) was approval for ‘renewal of contract’. And these approvals were given based on letters of request received from the GMD of NNPC.
The former Minister also described as ‘extremely disturbing’ report that Trafigura and SIR had lifted crude worth $24bn before their respective contracts were signed in 2014.
“If indeed that was the case” Aguiyi said, “then the Minister could not have been party to it, as the Minister was not involved in either the preparation or the signing of NNPC contracts”.
The statement said the minister reaffirmed signing the second set of requisite approvals requested by NNPC for renewal of the contracts of both Messrs Trafigura Beheer BV and Messrs Societe Ivoirienne de Raffinage in August of 2011, for a tow-year term, adding that by the action, she merely fulfilled a demand on her.
He stated that on the August 29, 2014, NNPC sought the approval from her for a new “short contract ratification term” that would expire on December 31, 2014, adding that “it became apparent that NNPC had failed to request for ministerial approval between late 2013 and August 2014 when the previous respective contracts had variously expired which meant that the various transactions had had no written ‘contractual cover’ for the periods varying from seven months to 12 months”.
He disclosed that SIR’s contract expired on October 3, 2013 and was renewed onAugust 29, 2014 while that of TRAFIGURAexpired on September 30, 2013 and was renewed on August 29, 2014 just as the one for Duke Oil expired on January 30, 2014 and was renewed August 29, 2014.
According to her spokesperson, “NNPC gave assurances to the Minister that it had assiduously upheld all its rights and performed its obligations as if a written contract existed during the periods mentioned, thereby ensuring the protection and safe guard of all national interests”.
Aguiyi also debunked insinuations that the former minister created the OPA and SWAP arrangements.
“It is important to note that the crude oil swap arrangement predates the tenure of Mrs. Alison-Madueke as Minister of Petroleum Resources. All the Swap/Offshore Processing arrangements currently in place, and under her watch, followed the same rigid template that was established by late Alhaji RilwanuLukman as Petroleum Resources Minister and approved by late President Musa Yar’adua in 2009. The Yar’adua administration had in 2009 signed a one-year term Offshore Processing Agreement with Nigermed Petroleum SA, a joint venture company between NNPC and British Petroleum International (BPI).
“The Offshore Processing Arrangement (OPA) and Crude Oil-Product Swap were strategic arrangements/decisions reached by the NNPC and the Federal Government in 2009 in view of the down-time of the nation’s refineries. The arrangement was designed to help NNPC achieve an effective and robust petroleum products delivery option to the Nigerian public. Under this arrangement, it was the responsibility of NNPC to identify a crude oil trader and term contract holder who has affiliation with a refinery. The Minister’s role is limited to granting statutory approval to requests made by NNPC in this regard” he explained adding that “the minister never exceeded her powers nor did she take on the role of anyone else”.

%d bloggers like this: