Nigeria’s state oil company Monday said allegations by Emmanuel Ibe Kachikwu, minister of state for oil, that the conduct of its group managing director lacked transparency and due process in the awards of contracts were baseless, adding that nothing was hidden from the minister.
Emmanuel Ibe Kachikwu, in a letter to the president dated Aug. 30 and confirmed by the oil ministry, had said Maikanti Baru, the managing director of the Nigerian National Petroleum Corporation (NNPC) had bypassed the board on key decisions and did not follow due process.
The NNPC, in a press statement, said “due process has been followed in the various activities,” and that the minister was in fact expressly consulted by the group managing director and his recommendations were taken into account in following through the laid down procedure, adding “for him to turn around and claim that “…these major contracts were never reviewed or discussed with me…” is most unfortunate to say the least.
Ndu Ughamadu, NNPC general manager public affairs, in the statement said that from the outset, the law and the rules do not require a review or discussion with the minister of state or the NNPC board on contractual matters.
“What is required is the processing and approval of contracts by the NNPC Tenders Board, the president in his executive capacity or as minister of petroleum, or the Federal Executive Council (FEC), as the case may be. There are therefore situations where all that is required is the approval of the NNPC Tenders Board while, in other cases, based on the threshold, the award must be submitted for presidential approval. Likewise, in some instances it is FEC approval that is required,” he noted.
He said the NNPC had cause to clarify severally from Bureau of Public Procurement (BPP) as to the composition of NNPC Tenders Board and the role of NNPC Board appointed by government and clarifications were gotten.
“The BPP expressly clarified that NNPC Tenders Board (NTB) is NOT the same as NNPC Board. The governing board (NNPC Board) is responsible for approval of work programmes, corporate plans and budgets, while the NTB is responsible for approval of day-to-day procurement implementation,” the statement reads.
The statement also said that clarifications were sought and obtained prior to August, 2015 and were implemented by Kachikwu as the GMD of NNPC, adding that Kachikwu also constituted the first NNPC Tenders Board on 8th September, 2015 and continued to chair it until his exit in June, 2016.
The statement noted that the allegations were baseless and due process has been followed in the various activities. It said that apart from the Ajaokuta-Kaduna-Kano (AKK) project and NPDC production service contracts, all the other transactions mentioned were not, procurement contracts.
“The NPDC production service contracts have undergone due process, while the AKK contract that requires FEC approval has not reached the stage of contract award,” Ughamadu stated.
