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Nairaland Forum / Nairaland / General / Politics / The-fraud-nigerians-are-subsidizing-wikileaks (2797 Views)
Let's Adopt The Ben Bruce Plan: Subsidizing The Poor / Ben Bruce’s Plan On Subsidizing Transport For The Poor / Vanguard Cartoon - : Who Is Subsidizing Whom? (2) (3) (4)
The-fraud-nigerians-are-subsidizing-wikileaks by desktop: 5:48pm On Jan 10, 2012 |
Reproduced below is a secret cable of the United States Government on the fraud in the oil sector in Nigeria as published by Wikileaks. C O N F I D E N T I A L SECTION 01 OF 02 LAGOS 000767 SIPDIS NOFORN E.O. 12958: DECL: 04/07/2014 TAGS: EPET EINV EFIN PGOV NI SUBJECT: SCANDAL BREWING OVER NIGERIAN FUEL IMPORTS Classified By: J. GREGOIRE FOR REASONS 1.5 (B), (D), AND (E). ¶1. (C) SUMMARY. A scandal is brewing in Nigeria over prices paid by the government for imported fuel. International fuel traders have been falsifying the dates of bills of lading to reflect particularly high market prices, overcharging the Nigerian National Petroleum Corporation (NNPC) by $300 million or more. END SUMMARY. ¶2. (C N/F) On April 2, Chris Finlayson, Chairman and Managing Director of Shell Petroleum Development Corporation of Nigeria (SPDC), told Consul General and Econoff that a scandal is brewing within the NNPC over payments made to international fuel marketers. Finlayson said some marketers have been changing the dates when fuel shipments bound for Nigeria were loaded in order to take advantage of particularly high market prices. He said the total overpayment by NNPC may be as high as $330 million. Finlayson noted that Shell is not one of the marketers in question, but is becoming a leading fuel supplier for NNPC. ¶3. (C N/F) On April 6, Femi Otedola, President and CEO of Zenon Petroleum and Gas, the largest supplier of diesel fuel in Nigeria, essentially corroborated Finlayson's report. Otedola said over $300 million has been overpaid by NNPC for fuel imports, and that many leading international traders are involved. According to Otedola, NNPC contracts to pay its suppliers the market price on the day a ship is loaded with fuel. He said NNPC recently discovered, however, that bills of lading were altered to reflect loading on days of high market prices. Discrepancies were found when comparing dates on the bills of lading with dates of landing in Lagos. ¶4. (C N/F) Pointing to examples, Otedola said that while a tanker loading fuel at a refinery in Bahrain usually takes four weeks to arrive in Lagos, comparisons between the bills of lading and dates of arrival of some shipments reflected only a four-day difference, and in other cases, if taken at face value, indicated the journey took nine months. Otedola said 73 shipments from refineries in the Persian Gulf, England, and Venezuela listed delivery times of only one day. NNPC is attempting to get compensation for the over-charge. Otedola went on that most of the fuel traders supplying Nigeria are implicated in over-charging NNPC, and showed a list of 17 companies that supplied fuel in the first quarter of 2004, several of which, he said, are significant players in international markets, such as Trafigura and Vitol. Otedola added that three companies clearly not involved in the scandal are British Petroleum, ChevronTexaco and Shell. ¶5. (C N/F) Otedola recommended that NNPC stop contracting with international fuel traders and negotiate purchases directly from refineries worldwide. According to him, such a move would have two positive effects. Otedola calculates that NNPC would save some four billion dollars a year in expenditures on imported fuel. (Note: Prior to deregulation in October 2003, NNPC, then the sole importer of fuel, lost two billion dollars per year because it sold stock to retailers below purchase price. After October 2003, NNPC initially stopped subsidizing fuel sales, letting marketers import fuel to be sold at market prices. However, sources agree that NNPC is back in the business of subsidizing gasoline sales while it maintains a facade of deregulation by encouraging private marketers to import fuel that NNPC purchases at market price. NNPC then sells the fuel to marketers and retailers at a reduced price to ensure that those companies maintain a profit margin while holding consumer prices to informal caps set by the Department of Petroleum Resources. End Note.) ¶6. (C N/F) Otedola added that by cutting out the international traders, NNPC would also enhance the environment in which Nigeria's refineries could be restored and operated. Otedola said he believes international fuel trade "mafias" are behind the failure to bring Nigeria's refineries back on-line and to capacity. Otedola is convinced these traders arrange for the vandalization of crude oil feeder pipelines, which keep the refineries at Port Harcourt, Warri and Kaduna closed or under-capacity. He said the international traders generally receive at least one million dollars per shipload of fuel to Nigeria and have grown accustomed to the easy money Nigeria offers as long its refineries remain down. ¶7. (C N/F) As an example, Otedola described an arrangement the National Electric Power Authority (NEPA) had with Sahara Energy for the provision of diesel to an emergency power generation plant in Abuja. He said that while a pipeline was under construction to deliver fuel to the main power plant, NEPA paid some five billion dollars to Sahara over four years for diesel to the back-up plant. It was later discovered that NEPA had received only about one billion dollars worth of fuel, according to Otedola. Otedola said that he, too, was contracted to deliver diesel fuel to the plant on occasion; however, he petitioned the president to investigate the matter after becoming suspicious of NEPA's ongoing contract with Sahara and the fact that the pipeline for the power plant was never finished. He said his intervention led to an investigation that ultimately resulted in the cancellation of NEPA's contract with Sahara. ¶8. (C N/F) COMMENT: The allegation that international traders bilked NNPC of hundreds of millions of dollars is yet another example of the poor management of Nigeria's energy sector, and highlights the complex links between crude sales, fuel importation, refinery maintenance, and energy production here. Otedola is probably right in suggesting that long-standing sweetheart deals between the NNPC and a variety of fuel traders is keeping the system inefficient. That may also explain why the GON just can't seem to get its refineries running even after spending a billion dollars or more on maintenance contracts over the last four years. Otedola said he initially bid to purchase the Port Harcourt refinery offered for privatization, but he recently told President Obasanjo he will not invest in the refinery so long as NNPC purchases fuel from traders instead of negotiating directly with refineries in other countries and leasing ships itself to deliver fuel to Nigeria. It is not clear if Otedola's assumption that the international traders' stake in Nigeria's current fuel market is the main driver behind the country's refinery woes. But it is clear that the fundamentals of infrastructure security, interim supply stability, and transactional transparency must still be addressed if the GON is to be taken seriously about its efforts to deregulate and largely privatize Nigeria's downstream petroleum sector. END COMMENT. HINSON-JONES http://theeagleonline.com.ng/index.php/home/news/487-the-fraud-nigerians-are-subsidising-wikileaks |
Re: The-fraud-nigerians-are-subsidizing-wikileaks by Pennywise(m): 6:02pm On Jan 10, 2012 |
This is just a part of the grand scam that Jonathan knows too well but he is either afraid or neglect to look into. He finds it more convenient to ask the Nigerian public to pay more. Guess what Jonathan this is a dawn of a new era. You have declared war on the Nigerian pple. If you want to know what happens to leaders who declare war on their pple, ask Gadaffi. 1 Like |
Re: The-fraud-nigerians-are-subsidizing-wikileaks by mencer(m): 8:20pm On Jan 10, 2012 |
Nigerians dont have an idea of who these cabal are and who they are out against. |
Re: The-fraud-nigerians-are-subsidizing-wikileaks by desktop: 1:13pm On Nov 17, 2012 |
This man is still insisting on total removal of what really? God i really think you need to smite some people and their descendants now o! |
Re: The-fraud-nigerians-are-subsidizing-wikileaks by Callotti: 3:05pm On Nov 17, 2012 |
We thank 'God'! With him, all things are possible and impossible for his cursed BLACK race! ![]() |
Re: The-fraud-nigerians-are-subsidizing-wikileaks by Standing5(m): 4:30pm On Nov 17, 2012 |
With the presence of our own local mafia who are ready to take over the foreign mafias under the guise of deregulation, i don't see much difference. What we need is an efficient system. |
Re: The-fraud-nigerians-are-subsidizing-wikileaks by Kolade9(m): 5:07pm On Nov 17, 2012 |
This his a bad things |
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