Business News
Reps summon Emefiele, Odubu, Others Over Abandoned NDDC Contracts
By Orkula Shaagee, Abuja
The House of Representatives ad hoc committee on contracts abandoned by the Niger Delta Development Commission (NDDC) has summoned the Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele and acting Managing Director of NDDC, Mr.
Pius Odubuh and the immediate past minister of Niger Delta, Pastor Usani and all former managing directors of NDDC to appear before it unfailingly next Monday.Similarly, NDDC’s directors of finance and administration, agriculture and legal services, environmental control and supply as well as that of budget monitoring and supervision are to also appear before the committee
Giving the order during investigative hearing in Abuja yesterday, the Chairman of the ad hoc committee, Hon.
Ossai Nicholas Ossai (PDP, Delta), said the invited officials are to explain how contracts were awarded for various abandoned projects and which companies benefitted from the deals.Ossai, whose order followed a motion by chairman of the House committee on foreign affairs, Hon. Yusuf Buba Yakub (APC, Adamawa) warned that the House being representative of the people will not condone any action that would undermine its authority. He wondered why the acting managing director of NDDC could not attend the investigative hearing after “the minister of Niger Delta had directed him to honour our invitation”
The chairman also frowned at the absence of other stakeholders including Bayelsa, Cross River and Edo states. Though Imo state government sent a representative, he could not make any presentation but rather asked for permission to be given time to prepare its submission. Ossai, however explained that Delta state government could not attend the hearing because the letter to the state governor was not delivered on time.
Testifying before the ad hoc committee, Akwa Ibom state governor, Mr. Emmanuel Udom disclosed that a total of 384 projects have been abandoned by the NDDC in different locations across the state. He explained that 148 of these projects were in Eket senatorial district, while 104 are in Ikot Ekpene senatorial district and 132 in Uyo central senatorial district.
Represented by the state commissioner for works, Mr. Ephraim Akparawa Inyangeyen further explained that some of the projects were abandoned for as long as 10 years, while some for 5 years and others in the last few years; and promised to get details of the defaulting contractors to the committee.
He lamented that the quality of job executed by the NDDC in Akwa Ibom was of very poor quality urging the parliament to impress on the commission to embrace international best practices in the execution of contracts.
“Honourable members, I want to bring to your attention that the roads constructed by NDDC across Akwa Ibom are of low standard. The contractors do not follow the designs. I want to appeal to this committee that in the course of this investigation, NDDC must be made to adopt international best practices because there is no need building substandard projects”
Also making his presentation, chairman of the Ondo State Oil Producing Area Commission, Mr. Gbenga Edema disclosed that the commission has 115 abandoned projects in the state.
Representative of the Aiyetoro community in Ondo state, Otunba Dele Kudehinbu in his presentation informed that the Aiyetoro Shoreline protection project, which was first awarded in 2014 at the cost of N2.4 billion to Gallet Nig. Ltd. Was re-awarded to another company in 2009 at the cost of N6.6 billion after the former had collected N650 million mobilization fee.
He another project, the construction of concrete jetty in Aiyetoro, which was awarded in 2013 to Global Link Venture at the cost of N82 million had been abandoned since 2016 with work only 50 percent completed.
Briefing the ad hoc committee, the Auditor General of the Federation (AGF) disclosed that since the inception of the NDDC, the federal government has released a total N738.025 billion as its contribution as enshrined in the act establishing it.
The AcGF, who was represented by the director in charge of federation account, Mr. Sabo Mohammed, explained that this amount was outside of the contribution from international oil companies (IOCs).
In his submission, the Auditor General of the Federation disclosed that from the audit carried by his office from 2000 to august this year, it has discovered that a total of N64.4 billion has been wasted as mobilization fees on abandoned projects across the Niger Delta region.
Director of audit in the OAGF, who represented the auditor general, told the investigative committee that it was shocking that after collecting mobilization fees, companies abandon projects explaining that the report of the audit has been submitted to government.
Also at the investigative hearing, the Olu of Warri, His Majesty Ogiamen Ikenwoli lamented that some projects awarded by the NDDC in Delta state since 2006 were still ongoing, yet there is nothing concrete on ground. According to the traditional ruler, the communities in the state were being eroded by exploration activities.
The Olu of Warri, who was represented by the Ogua Olusan of Warri, Chief Brown Mene expressed displeasure with the slow pace of work executed by the NDDC in the state noting that “the Koko-Owerri road, has been on the federal government drawing board for 50 years and this is supposed to be part of the trans African high way linking Akwa Ibom”
He said the Okene-Koko-Escravos road and the one leading from Escravos, the maritime university and Chevron were still not completed.
just as the committee learnt yesterday that so far, N64.4 billion have been frittered by the NDDC as mobilization fee for various contracts abandoned across the Niger Delta region with over 384 projects abandoned in Akwa Ibom and 115 in Ondo state.
Business News
Afreximbank Closes $282 million India-focused Club Deal
By Tony Obiechina, Abuja
The African Export-Import Bank (Afreximbank) has announced the successful completion of a first-of-its-kind India-focussed club deal for US$282.00 million.
Initiated for the exclusive participation of Indian lenders, and arranged by Bank of Africa UK PLC, the primary syndicated club deal saw participation from Indian lenders through their overseas branches and subsidiaries in the Dubai International Financial Centre in the United Arab Emirates, Singapore and Mauritius.
The facility, which was backed by six participating banks and financial institutions, including five that joined as first-time lenders to Afreximbank, helping the Bank achieve its objective of diversifying its funding sources, carries a three-year tenor.
At a commemorative event held in Dubai, U.A.E., to mark the conclusion of the deal, Haytham ElMaayergi, Executive Vice President at Afreximbank, said that the conclusion of the initiative represented a major milestone for the Bank as it sought to fulfil the key objectives of its funding programme.
Highlighting the importance of investing in, and for, Africa, Mr. ElMaayergi said: “this facility will help Afreximbank to continue to play a major role in the development of intra-African trade and trade between Africa and the rest of the world, particularly with India.
It is a testament to the rapid growth in Africa’s economic relationship with India and is evidence of Afreximbank’s growing ability to harness resources into Africa and to fund trade finance related investments that would have a positive impact on trade between Africa and India.”
Chandi Mwenebungu, Director and Group Treasurer of Afreximbank, reviewing the Bank’s vision for Africa, said that its funding objectives included achieving the diversification of its liability book by geography, investor type and tenor.
Also addressing guests at the event were Said Adren, CEO of Bank of Africa UK PLC, who thanked the lenders for their participation, and Zineb Tamtaoui, General Manager of Bank of Africa, Dubai Branch, who expressed appreciation for the opportunity to put together “a landmark deal that would be a stepping stone to many India-focused club deals going forward.”
Business News
Geregu Power Earns N50.4bn From Electricity Sales, Capacity Charges
By Tony Obiechina, Abuja
Geregu Power Plc has generated N50.4bn on electricity sales and capacity charges to Nigerians in the first quarter of 2024.
The power company which is the first listed power company of the Nigerian Exchange Ltd disclosed the performance in its Q1, 2024 financial statement.
The company grew its Q1 revenue by 225 per cent from N14.
2bn in 2023 to N50. 4bn in 2023.A breakdown reveals that Geregu Power sold energy worth N31bn and received N19bn as revenue from capacity charge.
Recall that the power company posted an annual revenue of N82.9bn in the full year of 2023 but it has covered half of the amount in Q1.
The revenue was above the company’s forecast for Q1 2024 when it projected its revenue to rise to N31.24bn.
Geregu Power recorded a profit before tax of N21.9bn up from the N5.3bn recorded in Q1 of last year, reflecting 307.8 per cent growth.
During the period underreview, the company saw its profit after tax rose by 307.3 per cent to N14.46bn from N3.54bn recorded in Q1 of last year. In the full year 2023, the company made N16.1bn net profit.
The net profit was above the company projection of N5.5bn.
Geregu Power took an income tax charge of N7.43bn, up from the N1.8bn in Q1 2023. The tax charges were higher than the N2.7bn projected for Q1 2024.
The company also spent N21.5bn on the cost of sales involving gas supply and transportation, up from the N6.6bn spent on gas supply and transportation in Q1 2023.
Business News
CBN Shakes Up Banking Sector: A Paradigm Shift Unveiled
By Ademola Oyetunji
In a surprising turn of events on Wednesday, the Central Bank of Nigeria (CBN) dissolved the boards of three prominent commercial banks – Keystone, Polaris, and Union Bank. This move, although unanticipated, transpired despite the Central Bank’s recent endorsement of these banks’ financial soundness.
Governor Olayemi Cardoso, at his inaugural address during the Chartered Institute of Bankers of Nigeria (CIBN) annual dinner last year, had lauded Nigeria’s financial sector’s resilience in 2023.
Stress tests conducted on the banking industry indicated its strength under various economic scenarios. However, Cardoso highlighted the need for banks to reassess their responsible banking framework, a sentiment echoed by President Tinubu.President Tinubu’s evident discontent with the Godwin Emefiele-led CBN triggered a comprehensive review of the financial system. A special investigator, Jim Obazee, was appointed to conduct a forensic investigation into Emefiele’s tenure, with damning revelations emerging. Recent developments suggest the initiation of a full-blown financial system reform.
The CBN’s dissolution announcement and the subsequent appointment of new executives for the affected banks, including Yetunde Oni, Mannir U. Ringim, Hassan Imam, Chioma A. Mang, Lawal M. Omokayode, and Chris Onyeka Ofikulu, might mark the beginning of implementing the investigation’s recommendations – a significant cleanup of the financial sector.
Allegations surfaced during the investigation, suggesting non-cooperation from some bank executives and Emefiele’s questionable acquisitions through proxies and cronies. Cardoso may have secured presidential approval for the CBN’s decisive action.
The CBN cited various infractions by the banks, including regulatory non-compliance, corporate governance failures, and activities threatening financial stability. Despite the challenges, the CBN assured the public of depositors’ fund safety and its commitment to upholding a safe, sound, and robust financial system.
The Special Investigator’s report revealed documents pointing to Emefiele’s involvement in Titan Trust Bank and Union Banks’ acquisitions with ill-gotten wealth. The CBN’s swift replacement of the ousted chief executives received widespread commendation, especially from high-net-worth stakeholders aiming to avert a crisis of confidence within the affected banks.
Adewale Aderounmu, an industrialist, applauded the CBN for implementing effective policies under Olayemi Cardoso’s leadership, despite detractors’ actions against the Naira. Ayomide Deepak, an Abuja-based stockbroker, welcomed the action but emphasized the need for caution in handling revelations from the investigation to prevent further economic challenges.
As the CBN wields its regulatory hammer on these banks, the hope is that other bank executives and investors will learn valuable lessons for the sake of the economy. The CBN’s action is perceived as a strategic move aimed at revitalizing the economy and financial system, not a mere vendetta.
*Ademola Oyetunji writes from Ibadan.