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Reps' panels move to end foreign domination in oil, gas sector BY GuardianPublished:Thursday, 12 March 2009 WITH about $60 billion earmarked by the Federal Government for gas development in the next five years, two committees of the House of Representatives are now pushing for legislation to increase the participation of Nigerians in the oil and gas sector. As part of efforts to diversify the country's economy, the Federal Government has earmarked $60 billion for gas development projects in the next five years. Chairman, House Committee on Gas, Igo Aguma, disclosed at the start of a public hearing on Nigerian content in the nation's oil and gas industry that $60 billion has been earmarked for gas development just as his counterpart in the Petroleum (Upstream) Committee, Bassey Otu, decried the privileges enjoyed by foreigners in the oil and gas sector. Aguma noted that in view of the huge investments in the sector, it was necessary to have a legislation in place to reverse the trend of few Nigerian participants in the sector. He added that if there was no law to deliberately increase Nigerian content, the huge investments would not make any impact on Nigerians. Admitting that the challenges were enormous, the lawmaker said the legislature should tackle the problem so as to bequeath a legacy to generations yet unborn. His words: "There are various levels of infrastructure developments going on in these plants and projects, such as the $20 billion investment in Brass LNG, $20 billion required for the gas utilisation plan and yet another $10 billion needed between now and the flare-down date. Nigeria is therefore committing an investment sum in the region of about $60 billion within the next five years in all the LNG plants and the various gas utilisation projects. These are no mean projects, and they speak volumes of the degree of attention required to be accorded the Nigerian content in the development of the all-important sector of the oil and gas. "The challenges are as important as they are frightening. As a legislature, we must bequeath an internally-driven oil and gas sector in the interest of an enduring, sustainable and unadulterated development of the nation." Otu noted that recent laws had not made any impact on the operations in the oil and gas sector, especially on the local content initiative. "The effect is that the recent laws have been receptive towards foreign investment and domination. How and to what extent have these legislative incentives been beneficial to our people and their welfare can be understood from the analysis of the last 15 years of oil business in sub-Saharan Africa," he declared. Otu lamented that oil that ought to be a blessing to the country has become a curse for Nigeria, stressing that the situation must be addressed squarely. According to him, "the best way to address the issue is through legislation. Therefore, the public hearing would assist in coming up with laws on improvement of local content." Another House committee yesterday summoned the Head of Service of the Federation, Amma Pepple; former information ministers, Dapo Sarumi and Frank Nweke (Jnr) to appear before it next Monday in connection with the dilapidated state of the Federal Government Press in Lagos and Abuja. They are to appear before the Dino Melaye-led House of Representatives Committee on Information and National Orientation to explain how the money meant for the supply of 43 machines and other equipment was utilised. While Pepple and Nweke are to explain why only seven machines have been supplied out of the 43 ordered for the Printing Press since 2004, Sarumi and the director of the Printing Press are expected to answer questions on why contract for the supply of a new miller machine 12 years ago was changed to a refurbished machine and supplied to the organisation. Melaye, who disclosed this while briefing reporters at the National Assembly yesterday, said the committee had uncovered sharp practices in the execution of contracts at the printing press, noting that this was responsible for the poor performance of the organisation. "A contract was awarded in 2004 for the supply of 43 machines and every kobo was paid. The contract agreement was that they should supply the machines within 6 months but as I speak to you, only seven machines have been supplied. We summoned Mr. Frank Nweke (Jnr) who was the minister at the time and Amma Pepple who was the permanent secretary at the time to appear at 2 o'clock on Monday next week." According to Melaye, the findings of the committee called for questioning, as "there are evidence of fraudulent practices and only those who were directly involved would shed light on the grey areas." He said the committee also found with dismay that the contract for the organisation's office in Asokoro, Abuja, was initially awarded at the cost of N351 million in 2004 to DTV and Co. Ltd. However, even as over N500 million has already been expended on the contract yet five years after, it is yet to be commissioned. As for the Lagos office, Melaye disclosed that the committee made some startling discoveries and decided to invite those who supervised the organisation at the time for explanation. His words: "We discovered this fraudulent practice where a refurbished machine was supplied instead of a brand new one, which contract was given and have decided to summon Dapo Sarumi who was the supervising minister at the time, the contractor that handled the project and the director of the Printing Press. "These are our findings and they call for questioning. No corrupt practice will be left unpunished. Another amazing thing is that the purpose of the project (Asokoro) was a printing press and another minister awarded contract for landscaping and the original job was abandoned." Also yesterday, the House Committee on Land Transport summoned the Minister of Transport, Ibrahim Biu, and his Finance counterpart, Mansur Mukhtar, to explain the circumstances surrounding the award and execution of the railway modernisation project on Lagos-Kano and the Ajaokuta-Itakpe-Warri rail lines. Others to appear before the committee chaired by Bernard Udoh, which began a public hearing on the projects yesterday, include the Central Bank of Nigeria (CBN) Governor, Prof. Chukwuma Soludo, and the Accountant-General of the Federation, Ibrahim Dankwambo. The ministers, billed to appear before the investigative committee today, could not do so because they were held up in the Presidential Villa in the Federal Executive Council (FEC) meeting. However, the Acting Managing Director, Nigerian Railway Corporation (NRC), Jetson Nwakwo, claimed that he knew nothing about the Lagos-Kano rail modernisation project just as he said that it was domiciled in the Presidency. But he agreed that his corporation played a pivotal role in Ajaokuta-Itakpe-Warri rail line projects. The managements of China Civil Engineering Construction Corporation (CCECC) and Julius Berger Nigeria Plc are also to testify before the committee. The finance minister, CBN governor, accountant-general of the federation and the auditor-general of the federation are expected to furnish the lawmakers with details of the financial outlay for the projects and ascertain whether the release of funds was done in consonance with due process. The committee, according to Udoh, would be investigating the $8.5 billion contract awarded in favour of CCECC during former President Olusegun Obasanjo's tenure just as it is determined to find out the actual value of Ajaokuta-Itakpe-Warri rail line awarded to Julius Berger.
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