Still on the Illegal Sale of AP Shares to Zenon Oil

By

Nuhu Shuaib

enshuaib@yahoo.com

 

 

The sale of African Petroleum shares to Zenon Oil by the last civilian administration constitutes one of the greatest economic frauds committed by former president Olusegun Obasanjo. The sale, or what I would prefer to refer to as transfer, was shrouded in mystery and it was a brazen show of shame by an administration that portrayed itself as being transparent and honest. This fraud was perpetuated at the twilight of Obasanjo’s exit from the seat of power in a hush-hush manner that calls for serious concern from all the stakeholders in the industry because of the heinous implications it portends.

 

It would be recalled that in Sadiq Petroleum emerged the core investor in the African Petroleum by purchasing the 30% equity shares divested by the government sometimes back in the year 2000. Former vice president Atiku Abubakar was accused of selling the company to his long time business associate in the person of Peter Okocha. This accusation gained wide acceptance because of the enormous influence Alhaji Atiku Abubakar wielded in the privatization programme of the Obasanjo administration. It was argued that Atiku Abubakar could not have presided over the sale of government properties without giving favourable consideration to his friends and business fronts that have, in one way or the other, financed the party that brought him to power.

 

However, Sadiq Petroleum ran into serious problem subsequently when it discovered that some material facts were not disclosed as the time it bidded for those shares. This misrepresentation of facts resulted into a debt of about N26 billion owed to some banks and the National Petroleum Corporation of Nigeria. Close watchers of the industry opined that Atiku Abubakar couldn’t have sold a company that is seriously indebted to his friend. Atiku was vindicated by this development. The former DG of BPE finally exonerated Atiku by an interview he granted in which he explained that it was not possible for anyone to influence the sale of any company because of the manner the arrangement was structured.

 

Chief Peter Okocha, owner of Sadiq Petroleum protested and accused the Bureau of Public Enterprise of misleading his company by concealing vital information during the exercise. His protest got the Federal Government to constitute a tribunal of inquiry on the debt matter. At the end of the whole saga, Chief Peter Okocha was made to resign his chairmanship position and Sadiq Petroleum relinquished its shareholding in the oil marketing company.

 

At a time, the Nigerian National Petroleum Corporation acquired the equity interest through its Staff Pension Fund in 2005 through a debt-swap of over N10 billion African Petroleum owed the corporation. The acquisition was subsequently gazetted and slated for sale through a competitive public bidding.  

 

In a rather controversial manner, former president Chief Olusegun Obasanjo sold the shares to Otedola who everyone knows to be fronting for him. The Independent Petroleum Marketers Association of Nigeria protested the sale by calling on the former president to intervene in the illegal sale. As expected, president Obasanjo did not give a hoot to the cries and worries across the industry. The sale was lacking in transparency and due process if one takes a careful look at the manner in which it was conducted.

 

Former president Olusegun Obasanjo had earlier directed that the Bureau of Public Enterprise to take over and conduct the sale through a competitive public bidding. This directive was not heeded. It is on record that no advertisements were placed before the sales were effected. More worrisome to this development is the fact that the Bureau of Public Enterprise was not privy to the transaction. Why was the BPE schemed out of this transaction? Was it to foreclose possible surprises from any quarters? Time shall tell.

 

It is also on record that Global Fleet Group had earlier paid the sum of N17.5 billion for an ascertained number of shares which was eventually cancelled. Zenon Oil, surprisingly, paid only N17 billion for the same number of shares. This translates to a loss of N500 million in the transaction. If someone has not benefited from the exercise, why was there no objection raised despite the loss of N500 million?

 

It could be concluded that the sale of the shares to Zenon Oil negated the much professed due diligence and transparency that has been the watch word of the Obasanjo administration. The whole process was fraudulent and shrouded in secrecy. This is inimical to the growth of our economy as it sends wrong signals to would-be investors and the international community.

 

It is also curious that Assemal, the core investor in African Petroleum after Sadiq Petroleum sold its 30% stake in AP to Afribank was not given preference over all the other bidders. It was expected that preference be given to Afribank on the principle of fairness and equity. But because someone somewhere was interested in cutting corners, all these were not given utmost consideration. This is very discouraging.

 

Nigerians would want to believe that the present government under President Umar Musa Yar’Adua has a listening year and going by happenings in recent times by which the government halted the sales of the refineries, it would be right to predict that AP shares would be taken from Zenon Oil.

 

Mal. Nuhu Shuaib

Okene, Kogi State