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$24bn crude oil swap deal has no contract –Reps

From Kemi Yesufu, Abuja

The House of Representatives Ad-hoc committee investigating $24 billion crude oil swap, yesterday, heard how there was no official contract for the deal between Nigerian National Petroleum Corporation (NNPC), Duke Oil and Transfigura, another oil company.

Indications emerged from the Hon. Zakari Mohammed-led committee that an estimated $27 million in taxes and levies are owed by the companies involved in the crude oil swap trading agreement implemented between 2011 and 2014.

Speaking at yesterday’s hearing, former NNPC Group Managing Director, Austin Oniwon disclosed that the over $3 billion indebtedness of the corporation as at 2010 led it to reassigning the deal. Oniwon said the adoption of the crude oil swap arrangement became necessary because “our cash flow was in trouble and we could not service the Federation Account and our suppliers.

“As management, when you are cash-trapped, you look for a cashless system available,” adding that NNPC paid for the 445,000bpd crude oil for the refineries, out of which 150,000bpd was approved for the swap arrangement.

The former NNPC boss explained to the committee that he obtained approval from the former minister of Petroleum Resources, Mrs. Diezani Alison-Madueke for the trading of the 445,000 barrels per day of crude allocated to the refineries. He also said only 150,000bpd were approved for the oil swap arrangement.

Another former NNPC group managing director, Andrew Yakubu, who led the corporation from June 27, 2012 to August 1, 2014, stated that all the refineries were working under his watch and put on-stream.

In his reaction, Mohammed, who reiterated that the committee was not on a witch-hunt, directed that past NNPC group managing directors submit copies of the approval given by Alison-Madueke for the oil swap, copies of the recommendations of the committee set by Yakubu to review the oil swap deal in 2014.

The committee also demanded the presidential approval, which increased the contract approval level of the NNPC group managing director from N100 million to $10 million.