On a serious note, the idea that $16b was siphoned by the OBJ administration under the guise of providing power to the country under the National Integrated Power Project (NIPP) should not be taken beyond mere soapbox polemics for whatever it is worth.
Some of the NIPP projects were the Omoku Thermal Power station, Rivers state; Gbarain/ Ubie Thermal Power Station, Delta State; Ikot Abasi Thermal Power Station, Akwa Ibom State; Eyean Thermal Power Station, Imo State and Calabar Thermal Power Station, Cross River state. These NIPP projects were designed to generate 2,276MW from six Niger Delta Power Stations, plus 2,610MW from upgrading four Power Holding Company of Nigeria (PHCN) Power Stations, plus 1,012MW from additional turbines for the Niger Delta Power Stations, all within a period of three years. A total addition of 5,989MW was expected from those projects.
It is true that the OBJ government came out with the NIPP and provisions were made in the budgets for these projects. However, less than 70% of those funds were released to the contractors in any of the budget years. Several reasons led to that aside from paucity of funds.
The NIPP contracts were structured on Engineering, Procurement and Construction (EPC). This meant that purchase of turbines and other accessories constituted over 70% of contract value of each project and a percentage of advance/down payment was required by turbine manufacturers before commencement of work. However, for most of the projects, the Central Bank of Nigeria bureaucracy combined with paucity of funds delayed, in some cases, for over a year before payments were made to equipment manufacturers for work to start. The national budget cycle did not also help matters. These and other reasons disrupted and delayed the projects. Even when equipment were successfully purchased, other hiccups reared their ugly heads.
For example, four Gas Turbines for the Alaoji projects brought into the country in 2006 were still at the Onne Port, Port-Harcourt years after due to the inability of the contractor to move them to the project site. This was mainly due to the inability of the Federal Ministry of Works to provide passage for the bulky equipment across the Imo River whose bridge could not carry the weight/capacity of the turbines. Other equipment meant for the projects that arrived the country between 2006 and 2007 were still lying fallow at the Onne Ports as the consignments could not be cleared due to documentation problems up till last quarter of 2008.
Because the civil works component at sites of the projects were minimal, some of the contractors focussed on seeing that the engineering and procurement which constituted the bulk and critical components of the projects were commenced. Again, funds for the construction component were largely not yet released as that portion of work was the most minimal and completion stage activity. This resulted in some of the contractors, in some cases, delaying in land clearing and structural work and where the site had been cleared not much civil work had been done as there was still a year or two before equipment would arrive. Some of the site preparation could be done under six months.
Meanwhile, the OBJ administration through the EFCC had accused Hon. Godwin Ndudi Elumelu who was the Chairman, House Committee on Power and Steel of having allegedly stolen about N5.6 billion from the coffers of the Rural Electrification Agency using 65 phoney companies that were purportedly awarded contracts for Grid Extension and Solar Electricity project. Others accused and being investigated for the fraud were Elumeu’s deputy, Jibo Mohammed, Senator Nicholas Yahaya Ugbane, and seven senior management officials of the Rural Electrification Agency.
To get back at OBJ, Elemelu scheduled oversight inspection visits to NIPP projects across the country. Fully aware of the challenges facing the NIPPs, Elemelu and his committee decided to conduct circus shows in which the OBJ government was lambasted at every site they visited for the benefit of the national and international media. While the drama was on, Elumelu repeatedly announced that the sum total of the value of NIPP contracts was $16bn. He deliberately refused to also announce the actual amounts released for the period under reference. To send home the message, at some sites where clearing had not been done, Elumelu gleefully told the media that despite spending over $16b ordinary grass at some of the sites were yet to be cleared. He claimed and everyone agreed that whereas even grasses have not been cleared at some of the sites, the full contract values have been stolen by contractors and OBJ government officials.
For some of those who had a bit of knowledge of the EPC nature of the contracts and the payment milestone regime knew that Hon. Elumelu was acting out a script to nail the OBJ administration for having the guts to investigate him and his committee for fraud. But the damage was done on OBJ and his administration already based on the uninformed and gullible nature of most Nigerians. It stuck to this day.
Worst still, when late Umaru Musa Yar’Adua came to office, he out rightly cancelled the NIPPs for no cogent, well-thought through reasons. Then enter the Jonathan government who had no choice but to restart the NIPPs. The rest is now history.
It was, therefore, a little unsettling when this narrative of $16b came up recently. I know it was good to use such bamboozling high sounding narrative for the campaigns especially after OBJ ‘dared’ us. But the elections have come and gone. There was no fraud of $16b anywhere. May be, if there was corruption here and there in the power sector, it would not be in the magnitude bandied but low level everyday corruption for which our nation has become infamous.
The Next Level should focus on how to rectify and re-situate the GEJ privatisation and unbundling of the power sector. The PMB government should consider discontinuing the national grid principle and focus on small and medium grid transmission network and improve on all that are being done at the moment. Probing an imaginary missing $16b will make many of us feel good but nothing more. It will be a waste of time and space. Nigeria hardly has the time for such frivolity!
Chris Finebone is a Port Harcourt-based politician
