- Category: Business and Economy
- Published on Saturday, 03 December 2011 14:14
- Written by Admin
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The Senate yesterday unmask the cabal milking the nation of trillions of naira from subsidy on petroleum products. The cabal have taken N3.655 trillion in the last five years and N1.426 trillion in the first eight months of 2011alone.
Picture: Femi Otedola (AP), Mike Adenuga (CONOIL), Sayyu Dantata (MRS Oil) and Wale Tinubu (Oando)
Chairman, Senate Ad-hoc Committee probing the management of fuel subsidy regime in the country, Senator Magnus Abe, read the names of companies benefitting from the fuel subsidy at the resumed investigation by the committee in Abuja.
Senate President, Senator David Mark, had lamented the existence of those he referred to as “oil industry mafia” and charged the investigative panel to unearth those behind oil deals.
President Jonathan had also lamented his helplessness and inability to tackle this powerful cabal hence his resolve to remove the subsidy.
Among the names reeled out by Senator Abe are; Oando Nigerian Plc. – N228.506 b, MRS oil – N224.818 billion, Enak Oil & Gas – N19.684 billion, CONOIl – N37.960 billion, Bovas & Co. Nig. Ltd. – N5.685 billion, Obat N85 billion and AP; N104.5billion.
Also, Integrated Oil and Gas owned by former Minister of Interior, Capt. Emmanuel Iheanacho was mentioned and is said to have benefitted to the tune of N30.777 billion, while IPMAN Investment Limited pocketed the sum of N10.9 billion.
Oba Otudeko owns Honeywell oil; Oando Oil is owned by Wale Tinubu who is Asiwaju Bola Tinubu's nephew; Mike Adenuga owns CONOIL; Femi Otedola owns and runs AP; MRS Oil is run by Aliko Dangote's nephew, Sayyu Dantata; and Integrated Oil and Gas, which is owned by a former Minister of the Interior, Capt. Emmanuel Iheanacho.
Regarding 2011subsidy pay out, the companies named by the Senate and the amount of money they have received this year alone include Otedola's African Petroleum, N104.58 billion; A.A. Rano, N1.14 billion; A.S.B, N3.16 billion; Arcon Plc, N24.116 billion; Aminu Resources, N2.3 billion; Avante Guard, N1.14 billion; Avido, N3.64 billion; Boffas and Company, N3.67 billion; and Brilla Energy, N960.3 million.
Others also listed are: DownStream Energy, N789.648 million; Dosil Oil and Gas, N3.375 billion; Inco Ray, N1.988 billion; Eternal, N5.574 billion; Folawiyo Energy, N113.32 billion; Frado International, N2.63 billion; First Deepwater Oil, N257.396 million; Heden Petrol, N693 million; Honeywell Petrol, N12.2 billion; Integrated oil, N30.777billion; AMP, N11.417 billion; Ascon, N5.271 billion; Channel Oil, N1.308 billion; Fort Oil, N8.582 billion; Enak Oil & Gas, N19.684 billion; IPMAN Investment Limited, N10.9 billion; Atio Oil, N64.4billion; AMP, N11.4billion; and Emac Oil, N19.2billion.
Abe, however, differed from the amount of N1.346trillion earlier presented by the Executive Secretary of the Petroleum Products Pricing Regulatory Agency (PPPRA), Mr. Reginald Elijah Stanley. He placed the figure at N1.426trillion.
Group Managing Director of the Nigeria National Petroleum Corporation (NNPC), Mr. Austin Oniwon, incurred the wrath of the Senator Magnus Abe-led committee when he could not tell them the units of crude oil refined per day in the nation’s refineries.
He had earlier told the committee that all the refineries combined couldn’t operate below 60 percent capacity, while the Port Harcourt refinery has not been operational for more than a month now. “By the design of the refineries, they can’t run below 60 percent when you charge it. That’s why we say it’s 60 percent. Unfortunately, for over a month now, the Port Harcourt refinery has been shut down. But when it runs, technically, it can’t run below 60 percent,” he said.
Committee member, Senator Bukola Saraki, whose motion triggered the Senate probe asked Oniwon to tell senators “the average capacity utilization of the refineries.”Oniwon replied:” I’ll get back to you on that.” This did not go down well with Saraki who pressed on with more questions. He asked again: “What amount of PMS would the refineries give us for the months of October, November and December?”
Again, Oniwon replied: “ At 60 percent, we’ll produce 13 million litres.” An angry Senator Saraki repeated his question and demanded details and documents on the amount of crude refined for those months to which Oniwon replied: “I didn’t come with the figures but I can submit them later.”
The panel also discovered a good number of the marketers did not meet the conditions for pre-qualifications to benefit from the subsidies adding that they are most times in the habit of making false claims; “leading to drain in the nation’s oil and gas industry”.
According to Abe, prospective marketers were required to own tank farms (petrol deports) of not less than 5000 metric tonnes, and should be registered with the Corporate Affairs Commission (CAC) as oil companies.
“Yet it was discovered that while only 11 marketers own storage facilities, the rest were “throughput” (sharing depots with filling stations) and some were registered construction companies,” he said.
Nonetheless, the Group Managing Director of the NNPC, Austin Oniwon told the panel that whereas a locally refined barrel of petrol costs $5, with a subsidy of N11.85 per barrel, the independent marketers were being subsidized with N77 per litre of N138.71, amounting to N12, 243 per barrel.
While adjourning sitting to Monday December 12, Senator Abe directed Oniwon to produce total amounts expended on turn around maintenance from 1999 to date, total dividends accruing to NNPC from the Joint Venture Companies, names of accused marketers, investigations conducted, results and subsequent punishments to defaulters at the next sitting.