$68.473m debt: House investigates NPA, Terminal operators
By Tom Okpe
The House of Representatives Public Accounts Commission (PAC) has commenced investigations of the Nigerian Ports Authority (NPA) and Terminal Operators Nigeria Limited over $68.473m debt owed the Federal Government on lease and ‘Throughput fees’ between 2006 and June 2022.
The Committee chairman, Rep Busayo Oluwole Oke, (PDP Osun) said the committee is also investigating the Terminal Operator for using own exchange rate different from the officially approved by the Central Bank of Nigeria, (CBN) in calculating revenue accruing to the Federal government as contained in the query from the office of the Auditor General of the Federation.
Managing Director of the NPA, Mohammed Bello-Koko had revealed in a submission to the Committee that one of the Port operators in charge of Rivers Port, and Terminal Operators (Nigeria) Limited used its own exchange rate in calculating revenue accruing to the Nigerian government.
The NPA boss stated in the Submission that PTOL used N116 to the dollar at a time when the official exchange rate was fixed at N305 to the dollar by the Central Bank of Nigeria in 2016.
The submission dated 27th July, 2022 which was in response to a letter from the committee also revealed that even while using another exchange rate of N151 agreed, after reconciliation, the terminal operator was still indebted to the government to the tune of $68.473 million as at 13th October, 2021.
The Auditor General of the Federation had indicted the company of not paying its lease fees and ‘throughout feed’ to the government, when due.
“While the document suggested that in 2008, PTOL was given a bill of $11,333,333.31 and paid $3,333,333.31, outstanding balance against them was put at $17,194,444.67 instead of $8,000,000.
“Similarly, in 2019, the bill given to the company for its operation at the Rivers Port Complex stood at $10,080,000.00.”
However, while the document indicated that they paid $3,000,000, outstanding balance against them was put at $102,714,749.66, a figure far above the bill given to it as its lease fees.
The submitted letter dated 20th, July 2022 to the Authority reads: “The historical background of the debt profile of PTOL to NPA dated back to the inception of the concession, in 2006.
“These issues revolve round the inability of the Operator to make payment on its lease fees as signed with BPE and NPA. PTOL gave the following reasons among others for its indebtedness to NPA.
“Amortization of berth 1-3. The difference in-amortization carried out by PTOL and what was recognized by NPA differ when converted from Dollar to Naira.
“NPA relied on the existing exchange rate given by CBN at 305 as at year 2016, at the time of reconciliation while PTOL used N116 to a dollar, being the -rate of dollar at the time of reconstruction.
“After reconciliation, a N151 to dollar was adopted, as stipulated in the supplemental agreement. The difference in valuation amounted to $11,068,187.16 and a credit note was issued on the 5th June, 2020.
“PTOL claimed no operation happened at the berth during the construction period of 2007 – 2009, hence loss of revenue. PTOL claimed 6 vessels were handled by NPA after the signing of the lease’ agreement. And a refund of 50% stevedoring element was considered.
“Huge disparity in lease fees charged compared to BUA. Disparity in existing draft with the initial advertised draft of 10 meters.
Security concerns at the Eastern Port. Oil and Gas related cargo vessel diversion to Onne Port, which they claimed affected their revenue.”
The letter said further that the outstanding debt profile as at June, 2019 against PTOL in NPA records stood at $100,985,846.82 while PTOL acknowledge only $77 ,976,788.81.
“This was predicated on the terminal operator paying a Guarantee Minimum Tonnage (GMT) penalty of $2,849,404.41.
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“This review was not implemented by failure of PTOL to pay the stipulated penalty. A further agreement to issue a credit note of $1,940,821.16 for the period the detained vessels were at the PTOL berth. These vessels were detained by various government agencies.”
The committee however, resolved that after these reconciliations, PTOL debt profile to NPA stood at $68,473,637.72 as at 13th October, 2021.
Determined to get to the root of the matter, the committee directed both the NPA boss and the terminal Operator to appear before it on Tuesday, 9th August, 2022; (Today) for further investigation.
