Organised labour on Thursday said the $1.5bn syndicated loan deal by the Nigerian National Petroleum Corporation was a conduit for looting the nation’s treasury. The Nigeria Labour Congress accused the NNPC of perpetrating a “fraudulent” dependence on fuel importation and looting of the treasury, saying the loan the government’s oil corporation said it needed to pay debts had further exposed the fraud in the management of fuel subsidy.
The Labour’s stance came on a day that the Senate insisted that approval by senators was required for the NNPC to secure such a loan.
“Under the law, no government agency can borrow money without the approval of the National Assembly. Our position still stands that the National Assembly is not aware of the purported foreign loan and position of the law is clear,” spokesman for the Senate, Eyinnaya Abaribe, said on Wednesday.
The NLC, in a statement by its Deputy General Secretary, Chris Uyot, said, “It (the loan) shows the kind of fraudulent way in which they manage this subsidy thing because if they required more money to handle importation, they should have gone into appropriation.
“It all goes to show us that the NNPC does not want us to get out of the so-called import of fuel. It is clear that individuals benefit from this fraudulent importation and that it should stop. Government should do everything possible to stop it. The whole idea of fuel importation is a conspiracy to loot public funds through other ways.”
As a way of checking the fraud in the oil sector, the Trade Union Congress urged the National Assembly to fast-track the process of passing the Petroleum Industry Bill, saying politicians preferred continued existence of the NNPC with its shortcomings.
The oil corporation had reportedly secured $1.5bn loan from both local and international banks.
The loan was said to have been brokered by Standard Chartered with the NNPC putting up its daily 15,000 barrels of oil production as collateral.
The corporation said the $1.5bn loan was needed to pay back older loans to big commodity traders and keep them from indebtedness with painful multi-million dollar write-offs.
The NNPC said it owed major commodity trading houses, including Glencore and Mercuria, about $3.5bn in unpaid fuel supply bills, according to a report commissioned by the Nigerian oil ministry last year.
The NLC recalled that the NNPC was indicted by the House of Representatives ad hoc committee on fuel subsidy.
The NLC stated, “That (the loan) is a most irresponsible action for a government agency to carry out, especially when the agency is one of those indicted by the probe carried out by the House of Representatives.
“It becomes apparent that government agencies like the NNPC and the Petroleum Product Pricing Regulatory Agency don’t want Nigeria to get out of the fuel importation trap.”
Also, the TUC president, Peter Esele, urged the National Assembly to put up a legal framework to prevent such a reckless borrowing by the NNPC.
He said, “NNPC is a business; they will borrow when they need to. NNPC is a business organisation that sells 2.4 million barrels of crude oil per day. So what is $1.5 bn to them?
“What have they (lawmakers) done about the PIB? You see politicians don’t want NNPC to go because that is where they make their money.
“The National Assembly should work on the PIB. We must find a lasting solution to this type of situation. We should let the company be, and put a law in place that would make the company to pay dividend to Nigeria.”
Abaribe, in an interview with one of our correspondents in Abuja on Wednesday said the law required that any loan by a federal agency must be approved by the National Assembly.
Media reports had quoted an NNPC source as saying that the loan did not require the approval by the National Assembly since it was purely on a business merit.
The NNPC had reportedly obtained the approval of President Goodluck Jonathan before obtaining the loan.
Chairman, Senate Committee on Petroleum (Downstream), Senator Magnus Abe, had also distanced himself from the loan, saying his committee would investigate the loans.
“We are still trying to confirm the loan from the NNPC,” Abe said.
Efforts to get the NNPC reaction to the latest development on the controversial loan did not succeed as calls to the General Manager, Government Relations of NNPC, Ms Tumini Green, did not go through.
Also, a text message to her phone on the subject was not acknowledged as of the time of this report.
Punch Nigeria
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