Tuesday, October 10, 2017

NNPC Scandal: Baru Fails To Address Two Key Issues In Response To Ibe Kachikwu

At the tail end of the first week of tension over alleged N9 trillion contract scandal at the NNPC, the Group Managing Director of the state-run oil firm finally broke his silence, dismissing all allegations of corruption as unfounded.

But Maikanti Baru, in a Monday morning statement, dodged key questions bordering on alleged insubordination as raised by the Minister of State for Petroleum Resources, Ibe Kachikwu.

The statement was issued on behalf of Mr. Baru as a response to Mr. Kachikwu’s August 30 memo to President Muhammadu Buhari over alleged corrupt practices, abuse of contracting process and insubordination by Mr. Baru.
Insubordination in personnel changes..
Specifically, Mr. Kachikwu told Mr. Buhari that Mr. Baru effected personnel changes and without recourse to him, the NNPC board or even the board services committee.

“Mr. President, yesterday like many other Nigerians. I resumed work confronted by many publications of massive changes within NNPC.

“Like the previous reorganisations and reposting done since Dr. Baru resumed as GMD, I was never given the opportunity before the announcements to discuss these appointments.

“This is so despite being Minister of State of Petroleum and Chairman NNPC Board. The Board of NNPC which you appointed and which has met every month since its inauguration and, which by the statues of NNPC is meant to review these planned appointments and postings, was never briefed.

“Members of the Board learned of these appointments from the pages of social media and the press release of NNPC.

“At the minimum and like all other parastatals being supervised by me at the ministry have continued to do, and in compliance with the proper governance standards expected of a serious public institution, these executive actions by NNPC were supposed to benefit from mine and the board’s input prior to presentation to you.

“Indeed in anticipation of vacancies that would arise from retiring senior executives of NNPC, I wrote the GMD a letter requesting that we both have prior review of the proposed appointments. This was to enable me to present same to the board.

“I wrote to the GMD given previous happenstance of this nature. In addition, thereafter, I called the GMD to a private meeting where I discussed these issues, Needless to say, that, not only did he not give my letter the courtesy of reply, he proceeded to announce the appointments without consultation or Board concurrence.

“Mr. President, please note that there is a Board Services Committee whose function is to review potential appointments and terminations of senior staff prior to implementation. This committee was also not consulted,” Mr. Kachikwu told Mr. Buhari of the August 29 personnel changes made by Mr. Baru.

He also informed the president that the NNPC GMD had attempted to sideline him in making new appointments at the NNPC but was prevented by Vice President Yemi Osinbajo when he was acting president. Mr. Buhari was away on sick leave in London from May 7 to August 19, leaving Mr. Osinbajo to act as president in line with the Constitution.

”I only need to add that previous attempts to rush through these appointments through a non-governance backdoor and present same to the acting president were met with a request that this be discussed with me. This was never done,” Mr. Kachikwu said.

Mr. Kachikwu also emphasised in his memo to Mr. Buhari that Mr. Baru’s alleged insubordination could hurt the performance of the state-run oil firm.

Consequently, the minister urged the president to ensure “joint presentation meetings between heads of parastatals and the Minister of State” in order to “encourage a culture of working together and implant discipline in the hierarchy.”

But Mr. Baru’s response Monday morning only touched on allegations of illegal contract awards — leaving out the issues of insubordination.

In justifying his decision to shun Mr. Kachikwu in awarding contracts, Mr. Baru said, as GMD of NNPC, he only needed to get input and approval from President Buhari, who’s also the substantive Minister of Petroleum Resources.

Mr. Baru said Mr. Buhari, as the president and Minister of Petroleum, was the chairman of the NNPC board and the approval he received from him was sufficient. But Mr. Kachikwu reminded Mr. Buhari in his memo that the president made him the chairman of the NNPC board.

The NNPC Act allows the president to delegate someone as the chairman of NNPC board, but the president can concurrently exercise powers of the chairman of NNPC board while the appointment of the person he delegated is still in effect.

But he did not say if Mr. Buhari also approved of his decision to make up to 55 key personnel changes at the NNPC without Mr. Kachikwu’s input.

Ndu Ughamadu, spokesperson for the NNPC, told PremiumTimes the issues of insubordination were secondary.

“The most critical is the one on contract,” Mr. Ughamadu said. We published the “the processes of awarding contract because that bordered on fraud.”

Mr. Ughamadu said the issues around insubordination would be addressed later.

Presidential spokespersons, Femi Adesina and Garba Shehu, did not respond to PREMIUM TIMES’ request about whether Mr. Baru had presidential approval to ignore Mr. Kachikwu in making appointments.

INSUBORDINATION IN MEETING..

Another issue that Mr. Baru avoided in his response was the claim that he was shunning meetings called by Mr. Kachikwu.

Mr. Kachikwu explained his experience in the hands of Mr. Baru as follows:

“The matter of collaborative meeting is another issue altogether.

“When I call for meetings, the GMD chooses which meetings he wishes to attend and those he chooses to send subordinate.

“He sends such subordinates without the courtesy of a call to explain his absence.

“The unattended meetings are in the majority. In all of 2017, I have been able only to get him to have one on one meetings with me about four to five times.

“At inception, I instituted a monthly parastatals review meeting with head of agencies and another with the all the senior management in all the parastatals.

“GMD objected to his senior staff coming to the joint senior management meetings. He argued that this was overreaching his territory.

“He was only comfortable with the Monthly all Heads of Agencies meetings which he has only attended a few times.

“I have had to carry on with the rest of the Ministry. Despite being Chairman of NNPC Board.

“I have tried to manage the bad perception created by GMD’s blatant insubordination and disrespectful attitude.

“Particularly I have worked hard to avoid being seen as pretty and meddlesome,” Mr. Kachikwu said.

The situation had created a “fear culture” at the NNPC, with officials of the oil firm distancing themselves from the Ministry of Petroleum for fear of being punished by Mr. Baru, Mr. Kachikwu said.

“The effect of the attitude of the GMD and the sidelining of the Board is that there is a fear culture in NNPC.

“The open administration I introduced, with your support in our first year of pushing reforms, has been completely eroded,” Mr. Kachikwu said.

Mr. Ughamadu declined to comment on this aspect to PREMIUM TIMES.

Industry experts warn that the feud could have riveting consequences on Nigeria’s oil sector, which is the country’s lifeline.

Bala Zaka, a petroleum engineer, said NNPC’s stock prices would have plunged significantly had it been a listed company.

“If NNPC was listed on the stocks exchange, its stocks would have crashed so much that it won’t be able to recover for many years,” Mr. Zaka told PREMIUM TIMES last week.

Mr. Zaka said Mr. Kachikwu’s revelations indicate that the NNPC, which had been dogged by corruption since its creation in 1977, had not changed even under Mr. Buhari.

“This further confirms that there has been no change in the NNPC since the days of Diezani [Alison-Madueke],” he said,

Mrs. Alison-Madueke has been accused of various acts of corruption while she held sway as the Minister of Petroleum Resources between 2010 and 2015.

Several properties linked to her have been forfeited to the federal government although she remains in the UK where she is also being investigated for money laundering.

Until his appointment as Minister of State for Petroleum Resources in 2015, Mr. Kachikwu was the Executive Vice Chairman and General Counsel of Exxon Mobil (Africa).

He had earlier served as the GMD of NNPC until July 2016.

A first class graduate of law from the University of Nigeria, Nsukka, and the Nigeria Law School, he also holds masters and doctorate degrees in law from the Harvard Law School.

He started his working career with the Nigerian/American Merchant Bank before moving on to Texaco Nigeria Limited from where he joined Exxon-Mobil.


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