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Contract Scandal: $3bn scandal rocks NPA

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Contract Scandal: $3bn scandal rocks NPA

Contract Scandal $3bn scandal rocks NPA

$21m ‘work’ invoice under probe
AGF to advice on relationship with indicted firm

Dredging of waterways to ensure smooth flow of shipping traffic through the many water channels into the Nigerian seaports has run into major controversy recently, following sharp practices which have continuously trailed the contracts.
The latest of these scandals involve the dredging of three water channels for which the Nigeria Ports Authority (NPA) is reported to have spent a whooping $3 billion (N1.09 trillion) since 2006, for questionable jobs allegedly done and invoiced.
Recently, courts in Switzerland convicted a Swiss company over a $20 million dredging bribery scam which named three top former officials of the NPA as being involved in the deal.

In addition, the Economic and Financial Crimes Commission (EFCC) is probing petitions for payment by the NPA of $13 million for alleged dredging of the Calabar Channel which some petitioners alleged were questionable.
The contract for the maintenance of the Calabar Channel was eventually terminated by the NPA, following rifts over the questionable $13 million invoice currently being probed and another $21 million invoice which the Calabar Channels Management (CCM) had lodged for further payment.

THEMOMENT learnt, the scandal also involves a top senator from the South East, who chairs one of the senate committees, who is said to be a major stakeholder in the CCM. He was alleged to have been mounting undue pressure on the NPA to honour the company’s invoices.

In the Swiss courts, Dredging International Services (Cyprus) Ltd was in June last year sentenced to a fine of one million Swiss Francs and asked to refund 36 million Swiss Francs being illegal profit after it was indicted for allegedly making illicit payments to a former Managing Director of the NPA; former acting Managing Director and former Executive Director as well as a former executive assistant to ex-President Goodluck Jonathan’s Special Adviser on Technical Matters.

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According to a report former top officials of NPA, between 2006 and 2011 allegedly collectively received $2.6 million in kickbacks.
Afam-Obi was said to have been paid $157,000 for unknown reasons while another $18 million was transferred to nine offshore accounts of companies where some yet unknown Nigerian officials have interests.

Dredging International Services (Cyprus) Ltd is part of a consortium which formed the Bonny Channel Management Limited that in turn entered into a joint venture arrangement with the NPA to form Bonny Channel Company in 2005.

But while Nigerians remain dazed by the indictment of Dredging International Services, the company recently bided for another NPA job further drawing criticism, but the Managing Director of NPA, Hadiza Bala-Usman, said the organisation has consulted the Minister of Justice and Attorney General of the Federation, Abubakar Malami, for advice concerning the contract bid by the company.

Usman said she raised the issue during a recent board meeting of the organisation and informed members of the board that the NPA was seeking the advice of the AGF regarding the organisation’s continued relationship with Dredging International.

Dredging International, which was fined $1million by a Swiss court for the bribery scandal, had explained to the court that it gave the bribe to the NPA officials to facilitate payments of its invoices which the authority had failed for more than six months to pay.

The firm argued that the unpaid invoices with the NPA were incurring a lot of interest in the banks and that the NPA members of staff refused to sign and pay it unless they were induced. All three officials of the NPA have been queried over their involvement in the alleged scandals.

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The contracts for the dredging of the Lagos, Calabar and Bonny channels involve three companies concessioned by the NPA which in 2006, 2013 and 2014 went into joint venture partnerships with private technical partners for the maintenance of the Lagos, Calabar and Bonny Channels,

This partnership resulted in the emergence of the Lagos Channel Management Company (LCM), Calabar Channel Management Company (CCM), and the Bonny Channel Management Company (BMC) set up for the maintenance of the Lagos, Calabar and Bonny water channels respectively.
But in spite of these arrangements, a higher level of efficiency has not been attained in the management of the water channels and that mega million dollar invoices are still being presented to and honoured by the NPA for the questionable dredging of these channels.

Inside sources in NPA disclose the parastatal is actually spending more on maintenance dredging of the channels than it used to do when the Private-Public Joint Venture Partnership was not in place and estimated that the federal agency has spent between $1billion and $2billion on the dredging of the Lagos and Bonny Channels alone since 2005.

The case of the Calabar Channel, which is a strategic gateway serving the North Central and North East geo-political zones of the country, appears to be worse. With over $13 million paid and another $21 million invoice generating heat, insiders report that no significant dredging has been carried out in the channel notorious for constant siltation which has in turn hampered navigation thus scaring away shipping traffic.

Worse still, it appears monies paid into the Calabar Channel Management Company has not reached the system as the company is reported to be going through serious financial stress including non-payment of staff salaries for months.

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The Senate recently, just weeks ago intervened in the scandals when it mandated the Senate Committee on Marine Transport to investigate the “dredging activities, books and records” of the NPA and the three contracted companies.
This followed a motion titled, ‘Senate‘s Intervention to Urgently Stop Monumental Financial Recklessness and Economic Waste by the Nigerian Ports Authority Under Its Joint Ventures with Lagos Channel Management Limited, Bonny Channel Management Company Limited and Calabar Channel Management Company Limited.’

Senator Ovie Omo-Agege, who tabled the motion, alleged that NPA had “failed, refused and/or neglected” to ensure the JVs’ comply with the Marine Environment (Sea Dumping) Regulations 2012 made pursuant to the Merchant Shipping Act 2007; the Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other Matters 1972, otherwise called the ‘London Dumping Convention,’ and the 1996 Protocol to the London Dumping Convention.

He pointed out that there were no dumpsites for the management of hazardous dredged wastes removed from the Lagos, Bonny and Calabar navigation channels, thereby leading to sustained severe pollution of Nigeria’s marine ecosystem.

In the case of the Calabar Channel dredging, insiders in the Nigerian Ports Authority disclosed that the channel has remained perennially non navigable to large vessels due to the fraud constantly associated with its maintenance dredging. Indeed, most times no actual dredging takes place even though antiquated dredgers are permanently stationed there even while they are not working and invoices are presented and honoured.

We gathered, the NPA management is presently at loggerheads with the Nigerian Global Engineering and Technical Company Limited-led consortium.

Source: themomentng

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