Nigerian Ports Authority says cancellation of INTELS boat pilotage contract was on TSA, legal advice

Nigerian Ports Authority (NPA) says cancellation INTELS boat pilotage contract was on legal advice from attorney general of the federation (AGF).

The NPA had in the week terminated the boat pilotage contract it had with oil and gas logistics giant, INTELS, which caused public questioning.

A statement signed by Abdullahi Goje, NPA general manager, corporate & strategic communications, said “The Nigerian Ports Authority is compelled to issue this statement in reaction to questions raised by the general public on the threat by our erstwhile agents, Intels Nigeria Limited, to fight the recent termination its boats pilotage monitoring and supervision agreement.

“To start with, we must inform our stakeholders and the general public that the Authority relied on the advice of the Attorney General of the Federation (AGF) and Minister of Justice, in arriving at the decision to terminate the contract.

Goje said the legal advice was sought after more than one year of attempts to get Intels to comply with the Federal Government’s directive on the treasury single account (TSA).

“The first such correspondence was through a letter written by Olumide Oduntan, former executive director, finance and administration, on June 28, 2016 directing the company to pay all revenues collected on behalf of the NPA into the TSA sub-account at the CBN,” he said, adding that all further attempts by the NPA to get the company obey this directive was met with various excuses until the Authority wrote to seek the AGF’s legal advise on how to proceed with the NPA/Intels relationship in a letter dated May 31, 2017.

The legal advice contained in a September 27, 2017 letter addressed to Hajia Hadiza Bala Usman, the managing dfirector of the Authority by Mallam Abubakar Malami, the attorney general of the federation (AGF) and minister of justice, expressly  stated as follows:

 “For the avoidance of doubt, the agreement for the monitoring and supervision of pilotage districts in the Exclusive Economic Zone of Nigeria on terms inter alia that permits Intels to receive revenue generated in each pilotage district from service boat operations in consideration for 28 percent of total revenue as commission to Intels is void, being a contract ex facie illegal as formed for permitting Intels to receive federal government revenue contrary to the express provisions of Sections 80(1) and 162(1) and (10) of the 1999 Constitution of the Federal Republic of Nigeria (as amended), which mandates that such revenue must be paid into the Federation Account/Consolidated Revenue Fund.

“In the premise of the above, the conflict between the agreement and the TSA policy presents a force majeure event under the agreement, and NPA should forthwith commence the process of issuing the relevant notices to Intels exiting the agreement which indeed was void ab initio.”

NPA said that as a responsible agency of the Federal Government, it, therefore proceeded to act as advised, which is to terminate the contract forthwith.

“However, the Authority respects the right of Intels and all other corporate entities in Nigeria to explore opportunities presented by the courts to enforce their rights in as much as the Authority is confident of the correctness of the step that it has taken,” the statement noted.