Business

Exposed! How APC Chieftain, Etiebet’s 2016 letter gave new clues to alleged N2.4bn debt to Access Bank

Published

6 years ago

May 6, 2019

Exposed! How APC Chieftain, Etiebet’s 2016 letter gave new clues to alleged N2.4bn debt to Access Bank

In a letter dated November 9, 2016 written by former petroleum minister and All Progressive Congress (APC) chieftain, Don Etiebet, in respect of what is turning out to be a messy N2.4 billion indebtedness by an oil and gas company, Top Oil, to Access Bank plc, appears to offer a new narrative to the dispute.

Writing in his capacity as chairman of Top Oil and Gas Company Limited, the letter shows an admission by Etiebet of the indebtedness and profused pleading for time to resolve the matter with the principal parties, CASTOIL that appear to have brought the business from Mobil Oil Nigeria Limited, for which Top Oil was hoping to profit from as a third party participant.

However, the Etiebet letter seen by Business A.M. among the documents making the court rounds, also shows while CASTOIL had the direct supply business with Mobil Oil, Top Oil made have found the business very attractive as to take full responsibility of sourcing the funds, hence the Import Finance Facility (IFF) made available to it by the bank for the purpose of importation of Automotive Gas Oil (AGO) for supply to Mobil.

In the letter addressed to “The Manager, Access Bank Plc, Business Banking Division, Chevron Roundabout Branch, Lekki” with the heading, “RE: US$6.3 MILLION OUTSTANDING L/C PAYMENT”,Etiebet refers to the ‘demands’ by the manager for the payment of an outstanding letter of credit (LC) of US$6,382,666.00, “which was used to import 10,000MT of AGO to supply Mobil Oil Nigeria Limited from Augusta Energy.”

In what appears to suggest an apology over the situation, Etiebet then wrote: “I regret that this payment is still outstanding till today. The true and correct position is that Top Oil and Gas Development Company Limited (TOPOIL) carried out this contract with a third party, CAST OIL and GAS LIMITED (CASTOIL) which brought the project from Mobil Oil Nigeria Limited. TOPOIL did not deal directly with Mobil Oil as it is common practice in the industry that companies cooperate to execute project of this nature and share the profit,”Etiebet wrote.

He went on to explain that after an initial payment made by the third party, CASTOIL, the latter failed to make further payment, suggesting this to be the reason for the delay and failure to redeem the letter of credit sum.

“Unfortunately, after the initial payment of N170,000,000.00 from CASTOIL into TOPOIL account with Access Bank Plc in August 2015 as agreed, CASTOIL failed to make further payments. CASTOIL then request (sic) TOPOIL to give it sometime to reconcile certain issues with Mobil Oil and in the process issued TOPOIL a “PAYMENT COMMITMENT” in the sum of N1,321,431,000.00, which is what CASTOIL owed TOPOIL for the L/C at N200/$ at that time plus other costs and to pay up in three instalments by the 31st of August 2015 as per attached CASTOIL letter,” Etiebet, in the letter, also referred to how the Economic and Financial Crimes Commission (EFCC) had become involved, expressing confidence that the money would be paid to TOP OIL for it to settle Access Bank, what it owes it.

The letter further reads: “When the commitment was not honoured, TOPOIL reported the case to the security agencies. In the process of the investigations, CASTOIL entered into another agreement with TOPOIL to pay up by the end of November 2015, with understanding to pay interests and any forex variation from N200/$ to the fx rate at the time of completion of payment. The case is being handled by the EFCC with CASTOIL’s Managing Director, Mr.TunjiAmushan being on Administrative Bail with sureties and his International Passport impounded as he reports to the EFCC every Thursday with promises to pay up. EFFCC has assured us that they would recover all the money plus interest and FX variation from him before long plus other sanctions.”

The letter showed that apparently while TOPOIL was trying to resolve whatever difficulties it was having with CASTOIL over the payment it did not inform or carry along its bankers.

In further demonstration of remorse, therefore, Etiebet then stated in the letter: “I am very sorry that this was not reported to you before now because we thought CASTOIL would pay up as has been promised since last year for us to liquidate the outstanding L/C payment. So I take this opportunity to commit to you that the debts of US$6,382,666 to your bank shall, meanwhile, be paid from alternative sources including profits TOPOIL would be making from its current contracts with NNPC-Retail to supply AGO to Total-Offshore. “With other contracts in the pipeline including the supply of PMS to NNPC-Retail, I hereby give my personal undertaking to pay all the outstanding in the US$6,382,666 within 90 days. I want to let you know that we all in TOPOIL regret this unfortunate situation but thank you so much for your continued understanding and cooperation,” Etiebet concluded his rapprochement to the bank.

Sources close to the situation said nothing came out of the promises made in this 2016 letter as the bank did not receive any payment. The bitter contestation of the indebtedness that is currently going on would shades this profound apologetic and hugely conciliatory position in this letter and raises questions about how things got to this point and what, if any, could be the underlying motive behind a complete repudiation of the debt that in this November 9, 2016 letter was fully admitted. In an advertorial widely published in the media, Obodex Nigeria Limited, a company in which Etiebet has large interest and is chairman, claims that it does not owe any debt to Access Bank, a claim which seems to contradict the November 9, 2016 letter.

FACT SHEET TO POINT OF DISAGREEMENT

On November 21, 2014, Access Bank, following an accepted offer letter to the TOPOIL provides a US$6 million Import Finance Facility (IFF) to facilitate the importation of Automotive Gas Oil (AGO) for supply to Mobil Producing Unlimited by TOPOIL. The facility was tenured for a year with a maximum of 90 (ninety) days circle. In addition to the US$6 million IFF, TOPOIL was also availed a N100 million Revolving Time Loan vide the same offer letter for the purpose of facilitating the payment of Custom duties and other related Logistics.
This was also tenured for 1 (one) year with a maximum of 90 (ninety) days circle. Several Letters of Credit (LCs) were issued on the facilities, but only 1 (one) remained unpaid which is A2015C1091CL. The facts on the stated LC are stated below: In April 2015 TOPOIL submitted a Proforma Invoice valued at $5,802,500.00 and informed Access Bank it had an order from Mobil. Consequently, LC A2015C1091CL was issued in favour of a company called Augusta Energy SA (“Beneficiary”).
Upon presentation of all shipping documents required for this particular LC, funds were remitted by the bank to the beneficiary. In 2016, Access Bank increased the TOPOIL’s IFF from US$6 million to US$12 million and this was communicated to TOPOIL in an offer letter dated January 20, 2016. When the facility was not paid, the chairman of TOPOIL, Don Etiebet wrote to Access Bank in a letter dated November 9, 2016 that the LC was done with a third party known as Cast Oil & Gas Limited and committed to repay the Customer’s indebtedness.
Due to TOPOIL’s failure to repay the sum of US$6,382,665.71 at the expiration of the facility, the said amount was converted into a N2.2 billion Term Loan through an offer letter dated July 4, 2017 and the unutilized sum of US$5,617,334.29 on the US$12million IFF was also converted to a N1,463,000.000.00 Time Loan through the same offer letter. The N1,463,000.000.00 Time Loan was, however, never utilised by the TOPOIL.

Business

Oil marketers counter Dangote

Published

4 hours ago

November 5, 2024

Sahara Weekly

Oil marketers counter Dangote over allegation of substandard product importation

The Depots and Petroleum Products Marketers Association of Nigeria (DAPPMAN) has countered the claim by Dangote Refinery that any oil importers landing petrol at a price cheaper than what the refinery is selling are importing substandard products and conniving with international traders to dump low quality products into Nigeria.

The refinery had made the claim on Sunday.

In a statement yesterday, DAPPMAN’s Executive Secretary, Olufemi Adewole, said none of its members was engaging in activities that could shortchange Nigerian fuel users by conniving with anyone to bring in low quality product into the country.

“We’ve said this for the umpteenth time, and it bears repeating, those in the downstream sector business of petroleum products trade are patriotic Nigerians who will not shortchange Nigerian citizens for filthy lucre. Our members are in this business to add value to the businesses of their fellow Nigerians and not to defraud them.

“Prices of products in the international market are dynamic as they’re dictated by prevailing circumstances at every given situation. We calculate our landing costs based on the dynamics of market forces, and the templates are always in the public domain. To claim that if the landing cost of imported product happens to be lower than that of the refinery indicates importation of low quality product is not only preposterous, but also fallacious. In any case, the management of the refinery has, until now, kept its cost and prices close to its chest and put it away from public scrutiny. “

“This type of submission, targeted at projecting our members negatively before the public, cannot help the management’s desire to have oil marketers patronise its products. What will ensure such patronage is transparency, fair play, and readiness to compete with others, including foreign refineries, on an even keel and on a level playing field.”

Adewole said the disclosure by the refinery’s management that the facility has a huge stock of 500 million litres fuel reserve came to its members as news.

“We were surprised because we believe that if the refinery has such huge stock, it’s the marketers that should be put in the know first.

‘Secondly, it was even more surprising given that the news came about the time the refinery was working on rationing what each marketer could pick from the refinery. If they had such huge stock, how is it then that they’re rationing what marketers could buy?

“On all these developments in the industry, the position of our members is very clear: we’ve always played by the rules, and we’ll continue to play by the rules. We’ll not be tired of advocating for a level playing field and a highly competitive and transparent sector that’s devoid of arm twisting and devoid of any form of dominant tendencies,” he said.

Similarly, the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) said it had concluded plans to import the best quality petroleum product and sell at far cheaper prices.

The association said it was awaiting the NMDPRA to grant it import licence, saying it “has successfully incorporated a strategic business unit called PETROL.”

Its spokesman, Joseph Obele, said PETROAN had concluded plans with her foreign refinery counterparts and financial partners to import the best quality of PMS and “then sell far less than the present selling rate of PMS in Nigeria.”

He said the allegations that PETROAN would import inferior products and that an international company was trying to establish a PMS blending plant in Lagos “are all strategies for Dangote Refinery to push others out of the market…”

Also, Pinnacle Oil and Gas Limited, in a statement by its Chief Executive Officer, Bob Dickerman, denied blending substandard petroleum products.

Business

Why Protesters demanded Kyari’s resignation

Published

5 hours ago

November 5, 2024

Sahara Weekly

Why Protesters demanded Kyari’s resignation

Scores of youths stormed the headquarters of the Nigerian National Petroleum Company Limited on Monday, demanding the immediate resignation of the Group Chief Executive Officer of the company, Mele Kyari.

The protesters, led by some Civil Society Organisations, described Kyari’s leadership as incompetent, citing skyrocketing fuel prices, endless fuel queues, and economic hardship in Nigeria.

The protesters carrying placards with different inscriptions such as “we demand the immediate resignation of Kyari”, among others, said the leadership of the NNPCL boss has failed.

The aggrieved youths led by Abdullahi Bilal of the (Two Million Man March Against Oil Scam Cabal) and Barrister Napoleon Otache and Olayemi Isaac from Citizens and Economic Freedom Rights Activists in Nigeria demanded immediate action to address what they described as failed leadership in managing the country’s oil sector.

Central to the protests were grievances over skyrocketing fuel prices and the never-ending queues, which they argued have driven inflation and plunged millions of Nigerians into poverty.

They also decried the importation of adulterated fuel, which they said is a corrupt practice that harms citizens by damaging vehicles and businesses.

They demanded an immediate halt to these imports and accountability for those responsible, questioning how substandard fuel continues to enter the country despite quality control assurances.

Additionally, the group criticized the unfulfilled promise of the Dangote refinery to resolve Nigeria’s fuel crisis, expressing frustration over the billions of dollars spent on refinery development and refurbishing existing facilities.

They argued that despite these investments, fuel shortages persist, leaving Nigeria reliant on costly imports even as an oil-producing nation.

They urged President Bola Tinubu to intervene by overhauling leadership in the oil sector, enforcing greater accountability, and putting citizens’ needs first. The protesters vowed to continue mobilizing until their demands for reform and transparency are met.

Speaking to journalists during the mass demonstration, Abdullahi Bilal said, “The Two Million Man March stands as a united voice for every citizen who has been betrayed by a system that continues to enrich a few at the expense of many.

“Today, we call for the immediate resignation of the current leadership in the country’s oil sector. Their management has failed Nigerians.

“Under their watch, we have seen fuel prices skyrocket without consultation or consideration of the devastating impact on the people. We have endured fuel scarcity while substandard, adulterated fuel is imported, causing further hardship.

“We demand the complete removal of the fraudulent fuel subsidy regime that has only served to enrich a select few. Full deregulation is necessary to introduce transparency, competition, and fairness to our oil sector.”

On their part, Otache and Isaac, insisted, “This act of economic sabotage has led to endless fuel queues, skyrocketing fuel prices, and unprecedented disruptions in the daily lives of Nigerians.

“We demand an immediate end to fuel queues, transparency, and accountability from all involved parties. We want to know how substandard fuel continues to enter the country despite assurances of quality control.”

On July 7, 2019, former President Mohammadu Buhari appointed Kyari as the 19th GMD of NNPC, but with the passage of the Petroleum Industry Act, his current portfolio is without recourse to previous employment ranks in the company.

NNPCL reacts

Reacting, the NNPCL spokesperson, Femi Soneye, said the protestors lack understanding of the sector.

He explained that contrary to their agitation, the GCEO ensured Nigerians had access to fuel at N620 per litre for over a year, even when the landing cost was above N1,100.

Responding via a chat, Soneye said, “Unfortunately, they lack understanding of the sector. If they were informed, they would know that the GCEO is not responsible for the fuel price increase; in fact, he ensured Nigerians had access to fuel at N620 per litre for over a year, even when the landing cost was above N1,100.”

Business

Renewed Hope Agenda and Impacts in Aviation* By Mary Odoma

Published

7 hours ago

November 5, 2024

Sahara Weekly

Renewed Hope Agenda and Impacts in Aviation

By Mary Odoma

President Bola Tinubu’s knack for selecting top talent is unparalleled. In his quest to build a prosperous Nigeria, he’s assembled an exceptional team. By leveraging their expertise, experience, and strategic insight, he’s fostering national stability, economic growth, and a sustainable future.

His latest win is in Aviation and Aerospace Development, where he’s appointed a fearless and straightforward leader, Festus Keyamo, SAN. Keyamo’s commitment to excellence makes him an ideal fit. President Tinubu’s vision for Nigeria is taking shape, and his leadership choices are truly commendable.

A dedicated, charismatic and impactful lawyer, the dynamic and astute developer is a terror to mischief makers and enemies of progress. A tough and forceful personality who is determined with an ultimate goal to change Nigeria.

Appointed on 21st August 2023 as the helmsman of the Ministry, Keyamo has been unwavering in his drive for positive transformation, reforming the sector and bringing about enduring positive impact in a transparent manner.

His Ministry has the core mandate of regulating air travel and aviation services in the country. It is also responsible for overseeing air transportation, air development, maintenance, provision of aviation infrastructural services and other needs.

A very patriotic Nigerian, Chief Festus has several achievements, in line with the Renewed Hope Aviation Roadmap approved by President Tinubu to his credit.

In a steadfast commitment towards revitalizing the nation’s aviation sector, Mr Keyamo was able to ensure the approval of the concession of the Nnamdi Azikiwe International Airport (NAIA), Abuja and Mallam Aminu Kano International Airport (MAKIA), Kano Airports. This is in line with the initiation of the Nigerian Airport Concession Strategy.

Also, in line with the Federal Ministry of Aviation Roadmap, Chief Keyamo initiated the signing of an MoU with the Nile University for the take-off of African Aviation and Aerospace University (AU). This milestone achievement of the Minister aims to integrate and create an avenue for the training, research and development of ready middle-class manpower for the sector.

Equally, under his watch, the pragmatic leader led the Ministry into partnership with the ICRC and also a collaboration with the IFC on infrastructural development. This partnership is to both develop and implement a comprehensive and durable framework that will meet the infrastructural needs of the sector over a long period.

Through Keyamo’s congruence and dynamism, the BASA arrangement is another revolutionary innovation aimed at ensuring the operationalization of direct flights between Nigeria and Brazil.

Keyamo’s motivation and altruistic devotion to having a functional aviation and aerospace sector also moved him to upgrade the Muhammadu Buhari, Airport, Maiduguri to the standard of an international airport. This airport is ready to commence full operation on January 1, 2025

In the area of staff motivation, retirees of the Ministry now have no cause for alarm as their interest is covered. Recently, the Ministry honoured 24 retirees drawn from the lowest rung to the highest. It is in a bid to acknowledge those who have contributed immensely to the growth and development of the sector as Nation-builders.

His prompt response to issues including distress reveals an empathetic personality and someone who is very much alive to his responsibilities. Recently, while reacting to the accident involving a helicopter on the 24th October 2024, Mr Keyamo, immediately upon receiving the distress call, activated protocols aimed at search and rescue operations, mandating all relevant bodies to do everything humanly possible to ensure the safety of the passengers on board the ill-fated vehicle.

The Minister was also actively involved with all the relevant agencies towards ensuring a coordinated response. His active and physical involvement led to the minimization of casualties.

In a show of collaboration and solidarity, the Hon. Minister travelled to far away Marrakesh, Morrocco, to give support to the 2024 International Transport Workers’ Federation (ITF) congress. His presence was to underpin the importance the federal government attaches to the role of the transport workers in stabilizing the aviation sector.

Festus Keyamo as the Honourable Minister of Aviation and Aerospace Development is certainly the best thing that has happened to the industry. He has exhibited passion, dedication and selfless forthrightness in the discharge of his duties and a total comprehension of what it takes to carry out his roles. He is well-groomed for the job and his background has helped him greatly towards shaping the positive impact he is making on society.

Today, Festus has proved that a faithful, disciplined, and dedicated Nigerian can stand out of the crowd because he symbolizes what governance is all about. These feats can only be achieved by a man with the right comportment and conduct in the service of humanity and the fatherland.

Deserving of note is that Chief Keyamo, through the foresight of President Tinubu has well-prepared team leaders appointed as heads of the agencies of the Ministry.

The supportive and collaborative roles of the Nigeria College of Aviation Technology, Nigeria Metrological Agency, Nigeria Civil Aviation Authority, Nigeria Airspace Management, the Federal Airports Authority of Nigeria, and the Nigeria Safety Investigation Bureau (NSIB), have brought about those tangible and noticeable volte-face experienced today in the Aviation sector.

With Keyamo at the helm, Nigeria’s aviation sector is experiencing a transformative shift, thanks to President Tinubu’s foresight in appointing well-prepared team leaders. The Nigeria College of Aviation Technology, Nigeria Metrological Agency, and others are working together to bring about tangible change. Keyamo’s dedication, discipline, and commitment to service have improved Nigeria’s image and reformed the aviation and aerospace sectors.

Odoma is the President of New Nigeria Network [NNN[ writing from Abuja.