Kachikwu vs Baru: Economist berates Buhari over role in face-off

.Wants President to hand off Petroleum Resources portfolio

.Osinbajo: I approved NNPC’s joint venture financing contracts

Ganiyu Obaaro, Lagos & Myke Uzendu, Abuja

Renowned economist and former university don, Dr. Kayode Familoni, has accused President Muhammadu Buhari of being a biased umpire in the ongoing power tussle between the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu and Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Dr. Maikanti Baru.

He said the development has shown a clear lack of direction in the management of the nation’s economy and its affairs by the President, adding that the development is capable of hurting the nation’s fragile economy.

He also alleged that a powerful cabal in the government is bent on having its way.

Familoni also accused Baru of acting beyond his statutory role as the GMD, as enunciated in the 1977 Act setting up the Corporation. He cited the relevant provisions of the Act; and the metamorphosis of the oil industry from its former to the current name, pointing out that recent development over the $25billion contracts scandal was totally in bad taste and must be reversed immediately by Buhari.

The Daily Times recalls that the President, last Thursday, held meetings with both Kachikwu and Baru on the leadership imbroglio at the NNPC.

The crisis of confidence, which had created a wide gulf between the two dramatis personae, following grave allegations of procedural breach in contracts award, amounting to $25billion, was blown open when it was allegedly leaked to the media.

The issue, which had since been trending in the country, soon became a subject of public discourse, prompting the President to immediately wade in.

Among other sundry allegations made by Kachikwu against Baru, both key personnel of Buhari’s government, included flagrant violation of rules in contract awards, as well as disrespect for his office as the Minister of State of
the Federal Republic.

For example, Kachikwu had argued, albeit with empirical evidence, that the oil “sector was also in a critical state where only innovative ideas can stop the alarming impact of the fall of oil prices on the National Income, adding that the innovations that he and his team had developed and started implementing in the downstream, upstream, policy generation, and Niger Delta security had enabled the sector to stabilise slightly.

“However, truth is that given global challenge in this sector, we must aggressively pursue out of the box ideas on rejuvenating this sector, getting the best yield and increasing our earnings from oil and gas. What this means is that parastatals in the Ministry and all CEOs of these parastatals must be aligned with the policy drive of the supervising Ministry to allow the sector register the growth that has eluded it for many years. To do otherwise or to exempt any of the Parastatals would be to emplace a stunted growth for the industry,” he averred.

To this end, Kachikwu appealed to Buhari to move in and save the NNPC and the oil industry from collapse arising from the non-transparent practices in the NNPC, and empower the NNPC to take the needed actions when needed.
His other prayers to Buhari include, “That you save, the office of the Minister of State from further humiliation and disrespect by compelling all parastatals to submit to oversight regulatory mandate and proper supervision which

I am supposed to manage on your behalf.”

But Baru, through the NNPC’s Group General Manger, Public Affairs Division, Mr. Ndu Ughamadu, has raised sundry issues in defence of his actions, saying that he followed due process in the alleged contract scam and insubordination, which Kachikwu had alleged in his August 30 letter to Buhari.

According to Baru, part of the Act setting up the NNPC, which is a successor to the then Nigerian National Oil
Corporation states thus: “An Act to dissolve the Nigerian National Oil Corporation and to establish the Nigerian National Petroleum Corporation empowered to engage in all commercial activities relating to the Petroleum industry and to enforce all regulatory measures relating to the general control of the Petroleum sector through its Petroleum Inspectorate department.”

He said that Part I of the Act states: “(1) There shall be established a corporation by the name of the Nigerian National Petroleum Corporation (hereinafter in the Act referred to as “the Corporation”) which shall be a body corporate with perpetual succession and a common seal and may sue or be sued in its corporate name.
“(2) The affairs of the Corporation shall, subject to Part II of this Act, be conducted by a Board of Directors of the Corporation which shall consist of a Chairman and the following other members, that is-(a) the Director-General, Federal Ministry of Finance and Economic Development; (b) the Managing Director of the Corporation; and (c) three persons to be appointed by the National Council of Ministers, being persons who by reason of their ability, experience or specialised knowledge of the oil industry or of business or professional attainments are capable of making useful contributions to the work of the Corporation; (3) The Chairman shall be a Minister in the Government of the Federation to be known and styled as the Minister of Petroleum Resources; (4) The supplementary provisions set out in the First Schedule to this Act shall have effect with respect to the tenure of office of the members of the Board (other than the Chairman), proceedings of the Board, certain duties of the members thereof and the other matters mentioned therein.”

But Familoni said that from the foregoing, “It is very clear from the provision of the NNPC Act (Part 1), quoted above, that the affairs of the NNPC shall be conducted by the Board of Directors, with a Chairman who shall be a Minister appointed by Mr. President. It is irrelevant whether the Minister is Senior or Junior so long as he is a member of the Federal Executive Council.”

For Familoni, “In effect, by appointing the Minister of State as the NNPC Board Chairman, it is ultra vires for the GMD (who is also a member of the Board) to circumvent the Board and its Chairman in the conduct of the affairs of the NNPC.

“By his appointment as Chairman, the President has delegated the authority of the Minister of Petroleum Resources to the Minister of State, as Chairman, with respect to the conduct of NNPC corporate affairs, simplicita. All arguments to the contrary are futile and pure balderdash.”

He said: “The GMD and his partners in the Presidency, who have illegally constituted themselves into an Oil Cabal and usurped the authority and powers of the NNPC Board are guilty of economic crimes and sabotage and should be prosecuted by the EFCC without any delay or rigmarole. The War Against Corruption, Indiscipline and Economic Sabotage should have no room for such deliberately plotted illicit and corrupt behaviour.”

“Mr. President must clean the augean stable and save the reputation of the Presidency. The Cabal has been able to sidetrack the NNPC Board on the pretext that the President is the Petroleum Minister and is therefore the substantive Chairman of the Board.

“This pretext is false, self-serving and symptomatic of kleptocratic governance. It is in the better interest of the country for the President to divest himself of the Petroleum portfolio and appoint someone from one of the major oil producing states as the Minister of Petroleum Resources.”

But in what appeared as a new twist that may also douse the raging tension over the contracts scandal in the NNPC, Vice President Yemi Osinbajo has said that he was aware of some of the actions of Baru, saying that he approved the NNPC’s joint venture financing contracts.

Osinbajo admitted, through a statement, that it was with his full knowledge and approval that the business deal was undertaken while he held sway as the Acting President, during Buhari’s medical vacation in London.

The number two man, who spoke through his Senior Special Assistant on Media and Publicity, Mr. Laolu Akande, in a series of tweets on his confirmed Twitter handle, @akandeoj, said he approved the recommendations for the contracts, as part of necessary actions to deal with the backlog of unpaid cash calls.

He stated that approvals were given by the then Acting-President after due diligence; and in accordance to established procedure as the President was away on medical vacation.

He tweeted thus : “In response to media inquiries on NNPC joint venture financing, VP Osinbajo, as Ag. President approved recommendations after due diligence and adherence to established procedure.

“Action was necessary to deal with huge backlog of unpaid cash calls which Buhari administration inherited; and also to incentivise much needed fresh investments in the oil and gas sector.”

Meanwhile, stakeholders in the Nigerian project have begun to raise concerns over the issue.