Oil theft: Counter directives stall take-off of cargo tracking scheme, aggrieved companies head to court

The federal government’s effort to fight the oil theft menace may have suffered a setback as directives and counter directives within the official circle stalled the scheme’s take-off.

This, according to documents obtained by Blueprint, followed the directive by the Chief of Staff to the President, Professor Ibrahim Gambari, which put on hold the process of awarding the Advanced Cargo Declaration and Tracking Note ACD/CTN) for all crude oil exports from Nigerian Terminals to frontrunner, Messrs Donnington Nigeria Limited.

Documents available to Blueprint showed Messrs Donnington Nigeria Limited, in partnership with Messrs Vortexa Limited UK, were on the verge of getting the nod from the Ministry of Finance, Budget and National Planning as well as Federal Ministry of Petroleum Resources to execute the contract before a counter directive.

In a bid to stem the massive theft of Nigeria’s crude oil, President Muhammadu Buhari assented to the request of the Economic and Financial Crimes Commission (EFCC) to immediately commence the ACD/CTN process for all crude oil exports from Nigerian shipping terminals.

Consequently, on May 10, 2021, an Executive Order was issued from the Office of the President and Commander-in-Chief directing the Federal Ministry of Finance (FMoF), in conjunction with the Federal Ministry of Petroleum Resources (FMoPR) to appoint an independent consultant that would track the volume of crude oil and gas lifted from the country.

BPP gives nod 

In a letter to the finance ministry, dated 03 December, 2021 and signed by Director General Bureau of Public Procurement (BPP) Mamman Ahmadu, the bureau stated that “Messrs Donnington Nigeria Ltd, with its parent company Donnington International AG based in Switzerland, demonstrated technical expertise and ability to manage the scheme and recover whatever revenue that might have accrued to Nigeria due to non-implementation of CTN over the years.”

However, on  January 19, 2022, the BPP reversed itself  when it wrote to the FMFBNP that it could no longer grant the ‘no objection’ until the ministry provides clarification that there are no overlaps between the FMFBNP’s ICTN and the federal ministry of transport ICTN scheme.

The Justice Ministry’s clearance

 Prior to this time, the FMoPR had on 7th January 2022, formally sent a letter to the Federal Ministry of Justice (FMoJ) requesting clarification and validation of the Presidential Executive Order as well as the mandate for the FMoPR.

The Justice Ministry responded on January 11, 2022, with a clarification that “only the FMoPR has the mandate to implement Crude Oil Services, and that the FMFBP has the mandate for Container Cargo Tracking.

To this end, the FMoJ further advised the BPP to “proceed in accordance with the request” from the FMoFBP and FMoPR.

 Following this “clarification and validation” from the FMoJ, the FMoFBP and FMoPR jointly and separately submitted a request to BPP to be granted a certificate of no objection to retain the services of Messrs Donnington Nig and her technical partner Vortexa UK.

CoS puts process on hold

And as the two ministries were set to proceed following the Justice Ministry’s advice/clearance, the Office of the Chief of Staff to the President, in a letter dated 16th August 2022 and signed by the Chief of Staff to the President, Professor Gambari, put the process on hold, a decision that sharply contrasts the Executive Directive by the president.

In the letter, the CoS based his counter directive on the fact that the Federal Ministry of Transportation and its agencies such as the Nigerian Shippers’ Council (NSC) and the Nigerian Ports Authority (NPA) have historically been responsible for administering the ICTN scheme-related functions, in line with their statutory mandate.

 Gambari stated in the letter that it was imperative the process for the selection of a capable agency/partner to implement the ICTN scheme in the country should be credible and transparent.

Excerpts from the letter read: “Honorable Minister of Transportation oversees the process for the selection of credible agents/partners to implement the ICTN scheme in Nigeria based on extant procurement guidelines.

“Ensure that the Honorable Attorney General and Minister of Justice should ensure a quick resolution of all cases that may stall the conclusion of the procurement process and approval of ICTN operator and

“Directed that this approval supersedes all earlier approvals on the matter and should be strictly complied with immediate effect.”  

 The twist 

And in line with Gambari’s directive, a new twist emerged via another letter from the BPP to the Nigeria Shippers Council (NSC) dated November 24, 2022.

It categorically stated  that due process ‘No Objection’ can be granted to the ministry of transport/shippers council to adopt Direct Procurement Method for the implementation of International Cargo Tracking Note (ICTN) in Nigeria in favour of the Messrs Antaser AfriqueBvba, Belgium/Antaser Afrique Ltd as the Lead technical Partner, Messrs Velocity Logistics & Marine Services Ltd, Messrs Sahams Crystals Investment Ltd, Windslow Logistics Ltd, and Equal Logistics Ltd, for a period of fifteen years on ‘No Cure, No Pay’ basis with a sharing formula of 60:40 for the revenue generated to the Federal Government of Nigeria and the consortium respectively. 

A source privy to the whole matter alleged Antaser Belgium that got BPP’s ‘no objection’ to implement the scheme was not part of the procurement process by the FMFBNP and MPR.

Our checks showed the contract was awarded to Antaser, alongside four Nigerian companies with notable Nigerians in government as their financiers.

This, a source said, runs contrary to a court injunction, legal advice by the justice ministry and the executive order of the president.

Donnignton pleads

While all this played out, Donnington Nig Ltd called on the Minister of Transportation, Mu’azu Jaji Sambo, to bring to President Buhari’s attention the fate befalling the project take-off.

Donnington, in a letter, requested the minister to expedite action on the issue of “No objection certificate” by the BPP, saying the country was losing revenue due to BPP’s action.

The company noted that despite meeting all the demands of the BPP and other government regulatory agencies, the sensitive security nature of the project and the urgency attached to its implementation by the president, BPP was yet to issue the certificate of no objection to the FMoPR.

The company further called on the BPP to heed the attorney general’s directive by issuing the no objection certificate to avoid unnecessary and lengthy court process that could lead at best to the government being ordered to pay compensation and damages to it.

Legal redress

It was gathered that the company, frustrated by the abandonment of the ongoing procurement process, the company filed a suit at the Federal High Court in Abuja to challenge the federal government in this regard.

In the suit, Donnington, through its lawyer, Dr. Reuben Atabo, the petroleum resources ministry, that of finance as well as transportation were listed as defendants.

The court gave an injunction asking that the status-quo remains pending the determination of the substantive matter.

The plaintiffs told the court that they “committed funds to procure equipment, engage staff and foreign partners,”  and that the defendants were  planning to bring in other companies in their place.

They further stated that the mandate for Container Cargo Tracking and Revenue Generation lies with Nigerian Custom Services under the supervision of the FMoFBP and Crude Oil Tracking is solely the responsibility and mandate of the FMoPR.

What ISOS Code says

According to the International Ship and Port Facility Security (ISPS) Code, the CTN scheme must be approved by legislation or executive order and not by any other approval, including that of the CoS to the president. 

 The company therefore urged President Muhammadu Buhari to wade in and direct both the Chief of Staff and the BPP to promptly ensure the issuance of the certificate of no objection to FMoFBP and FMoPR so that together with its partners, it can commence work on this vital national security project.

Minister mum

When Blueprint made efforts to get the reaction of the transport minister on the development, they were unsuccessful.

Specifically, one of our correspondents who reached out to the minister’s aide, Dr Sam Idiagbonya, was told the minister was attending the Federal Executive Council (FEC) meeting last Wednesday.

Specifically, he simply said ‘after FEC’ in the whatsapp chat replying to Blueprint ’s inquiry.

In other responses, he said ‘there are processes and procedures to this’, ‘you are cornering me.’

In yet another of his responses, Idiagbonya wrote ’treating’, ’I didn’t forget chief. I have forwarded to the Hm.’  

All these were in the space of one week that Blueprint sought to get possible reactions from the minister.

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