Multi-billion subsidy fraud: 6 BIG oil companies in trouble

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– The oil firms are among those listed as allowed to lift crude oil from Nigeria – The six companies indicted are currently facing legal prosecution

The Nigerian National Petroleum Corporation (NNPC), recently released a list of 39 companies allowed to lift crude oil from Nigeria for the period of 2017/2018.

It is interesting to note that at least of those companies have been indicted for subsidy fraud. This was contained in the same list released by the NNPC, where they stated the the 2017/2018 crude oil trade agreement.

According to Premium Times, more than 30 companies were indicted after investigations were launched, and several of them are still facing criminal charges in Nigerian courts for making hugely inflated subsidy claims.

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The contract announced by the NNPC would run for one year effective from January 1 for consecutive 12 circles of crude oil allocation and involves 18 Nigerian companies, 11 International Traders, five foreign refineries, three National Oil Companies (NOCs) and two NNPC trading arms.

The NNPC made it clear that all the contracts for the 2017/2018 crude trade were for 32,000 barrels per day except Duke Oil Ltd, an oil trading arm of the NNPC, which shall be for 90,000 barrels per day.

Out of the 39 companies announced, those indicted or still facing charges for fuel subsidy fraud include: Masters Energy, Oando, Eterna Oil and Gas, Seterna Energy, AMG Petroenergy, and Prudent Energy.

Olanrewaju Suraju the chairman of Civil Society Network Against Corruption, a coalition of anti-corruption organisations said:

“Many of these multinationals, oil companies, and other high-level investors in the system, they have a way of manipulating the system that you won’t be surprised if many of them also have contributed to the campaign and funding of some of these political parties and government officials. “So they pay them back which is usually considered an investment in the electoral process. They get to pay them back with these kinds of contracts.”

According to Premium Times, the spokesperson for Prudent Energy, Kamil Adebumola, said the company was erroneously included in the list of marketers indicted for oil subsidy fraud and had been cleared of the allegations.

“Also, at no point did we import product under the PSF scheme without due application and approval from PPPRA,” he said.

The Masters Energy spokesman also denied that the company was indicted in the oil subsidy scam.

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Emma Iheanacho, the company’s head of corporate communications said: “As a major player in the downstream operations of the oil and gas sector, we were invited like other marketers during the petroleum subsidy investigation, which we attended and satisfactorily made presentations on our various transactions during the period backed with relevant documents.

“We were thereafter cleared by SFU and EFCC.”

However, activists say the fact that indicted oil marketers were among those to purchase and lift crude oil means not much has changed.

Mr Suraju an activist said: “If the EFCC is yet to issue a clean bill of health to those oil companies that were found wanting in the oil subsidy scam and the government is already engaging them for the same services that they, in the past, were stealing from the government and the people of Nigeria, then it is also saying that it is still business as usual.”

Ndu Ughamadu, the NNPC spokesman, has however said the government does not have any reason to blacklist any oil marketer because the charges against them are still before the courts.

“If proceedings are still in court and there are no injunctions that company A should be temporarily barred from doing certain things, the organisation is not obliged. “They are still in court, and their filling stations are all over the place and they’ve been importing products for the country and in the interest of the country. “If the court puts an injunction on a particular company and the NNPC is served, maybe as the major stakeholder that deals with that particular company, NNPC is a corporate entity and we abide by all the rules and regulations of the country and all the injunctions of the courts.”

Meanwhile, here is a full list of the confirmed that 39 companies have won the crude oil term contract for the purchase and lifting of 1.306 million barrels per day of Nigeria’s crude oil for 2017/2018.

Below is a video of the oil situation in Nigeria: