The Nigerian National Petroleum Corporation (NNPC) has described allegations that it inflated the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline Project was inflated to the tune of $1.527 billion as unfounded, false and baseless.
According to a statement Monday by the Corporation’s Group General Manager, Group Public Affairs, Dr. Kennie Obateru, the publication also questioned the integrity of the Bureau of Public Procurement (BPP).
The NNPC spokesman added that the Corporation was considering instituting legal actions against the medium and its collaborators.
The state run oil company stated that even the Bureau for Public Procurement (BPP) completely rejected the speculative analysis of the online medium as false and not portraying it’s the true position on the matter.
“This is clearly a concocted analysis aimed at attacking the character of the Group Managing Director (GMD) of NNPC, Mallam Mele Kolo Kyari, and the integrity of the Bureau of Public Procurements (BPP). Mallam Mele Kyari did not become the GMD until July 2019 and he is being mentioned in a process that took place in 2017 by the account of the publication. This is rather unfortunate and malicious, considering that a further cut of $300million of the contract value was achieved under the Mele Kyari-led NNPC Management leading to the recognition by the Federal Executive Council as an unprecedented action.
NNPC maintained that BPP, following a detailed review and analysis of the procurement bid, confirmed that the unit costs for line pipes adopted by the NNPC for the project were reasonable when compared with current market prices for 40”, 36”, 20” and 14” steel pipes, adding that it was on that basis that the procurement bureau confirmed and granted certificate of no objection dated August 11, 2017.
NNPC stated that the AKK project underwent a transparent and open competitive tender process that resulted in the emergence of the most competitive bidders, wondering how a competitive tender process could be inflated.
“Approval of all relevant authorities were obtained after an intense scrutiny by the various agencies. This is a deliberate attempt to mislead the Nigerian public with baseless information”, the release exclaimed.
NNPC said the AKK pipeline project was one of the key landmark projects that have had transparent processes from inception to date, with the entire evaluation exercise carried out by NNPC and Infrastructure Concession Regulatory Commission (ICRC).
The corporation cited the various stringent due process reviews and scrutiny, internally and externally, which the AKK pipeline project was subjected to to include: Conduct of project bankability study, at project’s conception in 2013, undertaken by Standard Chartered Bank to confirm appetite for attracting financing from international community; Execution of project feasibility and Front End Engineering Design (FEED) by a reputable international company, ILF of Germany, in 2014. The details developed at this phase had enough engineering design details to enable a competitive class of estimate to be submitted by the contractors; Advertisement of the project in both local and foreign print media in 2013. After completion of the FEED study by ILF in 2015, the prequalified bidders were issued tender documents; Competitive tendering and evaluation of the bids by both NNPC and transaction advisers, Alpine and also by a team from ICRC; and Extensive review of the project design and the final cost in 2017 by the BPP, culminating in the issuance of a Certificate of No Objection in August 2017 among other processes.
NNPC stated that after several failed attempts in the last 13 years to commence the AKK project activities, the leadership of Mallam Mele Kyari, within one year of stewardship brought the project on track leading to the award of the contract at a competitive price and eventual flag off of construction that the world witnessed in June 2020.
Obateru called on all well-meaning Nigerians to give the Mallam Mele Kyari-NNPC led management the credit it deserves, even as it encouraged them to follow the execution of the project which it said was being undertaken in a transparent and aggressive manner in line with Transparency, Accountability, Performance Excellence Agenda of the Corporation.
NNPC advised members of the public to ignore the online medium report which is designed to distract Mallam Kyari from successful pursuit of delivering the Next Level Agenda of President Buhari.
