EXPOSED! How Diezani Alison-Madueke Plans To Sell Refineries To Fronts

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The planned sale of Nigeria’s four refineries next year is a well-designed scam calculated to hand over the country’s premium downstream assets to associates and fronts of the Minister of Petroleum Resources, Diezani Alison-Madueke, who is also representing the financial interests of President Goodluck Jonathan in the deal.

According to several senior officials at the ministry, four of the minister’s friends have been penciled in to emerge as preferred bidders by “any means necessary” even as the Bureau for Public Enterprise (BPE) has announced its readiness to commence the sales next year. Top on the list of the “preferred” buyers is Mr. Jide Omokore, the multi-billionaire PDP figure who has received numerous juicy deals since Ms. Alison-Madueke was made Minister of Petroleum Resources by President Goodluck Jonathan in 2010. Mr. Omokore is the chairman of Energy Resources Group, whose subsidiary, Atlantic Energy Drilling Concept Limited, was involved in a highly scandalous operatorship take-over of the oil mining licenses (OMLs) of the Nigerian National Petroleum Corporation (NNPC) in 2011.

Mr. Omokore, whose private jet is regularly put at the disposal of Ms. Alison-Madueke (as do jets by her other fronts and associates), famously funded an obscene wedding in Dubai for his son, Oluwatosin, last June. Some estimates put the cost of the wedding, which was attended by state governors, ministers, senior civil servants, senators, former governors and political godfathers, at $10 million. Oluwatosin’s bride is Faisal AbdulKadir-Fari, a daughter of Ambassador Abdulkadir-Fari, then the Permanent Secretary in the Ministry of Petroleum Resources.

Another “preferred” buyer, Kola Aluko was also involved in the controversial OML operatorship deal through his company, Septa Energy, a subsidiary of Seven Energy. While Mr. Omokore’s company got oil bloc numbers 26, 30, 34, and 42, Igho Salome’s Taleveras got OMLs 4, 38 and 41. In the questionable deal, Shell divested its operatorship in the OMLs. By law, the ownership automatically reverted to the NNPC which manages oil assets on behalf of the Federal Government of Nigeria. At first, the NNPC had transferred its operatorship to its exploration subsidiary, Nigerian Petroleum Development Company (NPDC).

But in a curious twist, the NPDC said it did not have the financial resources to operate the OMLs. The group then organized a “strategic loan” deal with Atlantic Energy and Septa Energy to provide the funds. Under the questionable deal, Mr. Omokore and Mr. Aluko’s companies were to receive crude oil allocation of over 40,000 barrels per day as “loan repayment.” An oil industry expert told SaharaReporters that the deal, which was officially called “strategic alliance and service contract,” will cost Nigerian taxpayers billions of dollars.

Another NNPC insider told Sahara Reporters, “Where in the world would you own seven lucrative oil blocks and then claim you do not have the finances to operate them? Those are enormous bankable assets. There is no bank NPDC will approach in the world that will not jump at the opportunity to finance the operations. Remember these are not mere oil prospecting licenses (OPLs). They are OMLs. Oil had been found there. Shell had been producing oil from the wells. It only decided to relinquish its interest to focus on in its offshore wells.”

Several of our sources questioned NPDC’s claim that it needed to bring in Atlantic Energy and Septa Energy to finance the production. “It all had to do with the minister’s financial stake,” said one of them, insisting that Ms. Alison-Madueke had a reputation for tailoring oil policies to benefit her pocket.

“The same NNPC that claimed it could not secure the finances to operate the oil blocks later took out a loan of $1.6 billion to pay dubious debts owed to shady oil dealers,” another insider told Sahara Reporters, further highlighting how greedy and selfish government officials strangulate the country. He said the minister cannot come up with any satisfactory justification for her scandalous policy of mortgaging the country’s oil assets to her friends.

Meanwhile, our sources identified the other two “preferred” buyers for the refineries as Talevaras, a firm owned Mr. Igho Salome, and Sahara Energy, owned by the trio of Tonye Vole, Tope Osinubi and Ade Odunsi. Talevaras has increasingly come under the spotlight because of its sudden rise to prominence in Nigeria’s business scene. The firm was recently declared the “winner” of the bid for the Afam Power Plant, despite its lack of any experience in the power sector. The Afam Power Plc was among 18 assets of the Power Holding Company of Nigeria (PHCN) which were put up for privatization. Initially, none of the bids received for Afam Power Plc was deemed qualified. But the government suddenly announced Taleveras as the winners of the bid.

“I can assure you that the same style will be adopted to hand over Nigeria’s refineries to the minister’s fronts, usually referred to as preferred buyers,” an official of the Ministry of Petroleum Resources said. He continued, “It is not a coincidence that the minister went to announce to the whole world that the refineries would be sold first quarter next year even when there were no such plans disclosed to the BPE. It should be of interest you that the BPE made its own pronouncement a week after the minister’s, just to rubber-stamp it. BPE indirectly exposed her plot when it said the process would commence first quarter next year, rather than the refineries being sold first quarter next year as pronounced by her.”

Sahara Energy was also indicted in a report by a Swiss non-governmental organization, the Berne Declaration. The report revealed that Nigerian oil marketing companies perpetrated widespread subsidy fraud running into several billions of dollars. Titled “Swiss Traders’ Opaque Deals in Nigeria,” it also accused the NNPC of colluding with international oil traders to defraud Nigeria. The report revealed that Sahara Energy, Rahamaniyya Group, Aiteo Energy Resources Limited, Ontario Oil and Gas Limited, Tridax Energy, Mezcor Limited and MRS Group had established subsidiaries, also called “letter-box” companies, in Geneva, Switzerland, with no real business activities.

The report disclosed that these companies established the subsidiaries primarily for tax advantages, and also for easy access to international capital. But four of the companies, namely Sahara Energy, Rahamaniyya, Aiteo Energy and MRS, were investigated by the House of Representatives Ad Hoc Committee and cleared in a widely discredited report that culminated in the infamous $620,000 bribery scandal involving the chairman of the House probe committee, Farouk Lawan, and billionaire businessman, Femi Otedola.

According to the Swiss NGO report, the opaque partnership between NNPC and the Swiss oil traders ensures that the profit generated escapes state coffers. Describing this as “not trivial,” the report stated: “By way of example, in 2011 the amount withheld from state coffers came to $8.739 billion. The public coffers were directly penalized. The same year, the revenues from oil fell by 39 per cent against the amount budgeted. And this is despite a rise in the price of oil.”

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