NNPC: Capital Oil Has Repaid N2bn, Still Owes N9bn But Creditworthy

• Ubah refutes allegations of theft, says corporation owes his firm N16bn

James Emejo in Abuja

The Nigerian National Petroleum Corporation (NNPC) thursday claimed that Capital Oil and Gas Limited owed it an outstanding sum of N9.1 billion resulting from the N11 billion worth of petroleum products allegedly diverted from the latter’s storage facility.

The Executive Director, Finance and Accounts, NNPC Retail, Mr. Ibrahim Juma Dansure, said Capital Oil had only paid N2 billion of the total amount.

He said negotiations were being currently brokered between the Department of State Services (DSS), Economic and Financial Crimes Commission(EFCC), corporation and the oil firm on an effective payment plan.

Dansure noted that Capital Oil had already admitted it diverted 84.89 million litres of petroleum products belonging to the NNPC without the corporation’s approval.

The value of the diverted products was put at N11.14 billion at a rate of N131.28 per litre.
Speaking at the ongoing investigative public hearing organised by the House of Representatives Committee on Petroleum Resources Downstream to among other things probe the the disappearance of N11 billion worth of petroleum products belonging to the NNPC at Capital Oil Farm tank, Dansure however, admitted there was no basis to question the credit worthiness of capital oil in their partnership.

He said though the two parties were on the same page regarding the volume of products involved, there’s disagreement over the actual value as NNPC exacts N131 per litre of the products while capital oil alleged N120 per litre.
Both sides accused each other of alleged breach of contract.

NNPC said the oil firm traded its oil without authorisation but the former insisted no clause in their throughput agreement forbids it not to tamper with products as long as its made available whenever needed.
However, Managing Director, Capital Oil and Gas Limited, Mr. Ifeanyi Ubah, told the committee that NNPC was also indebted to it to the tune of N16 billion over the past two years.

He said capital oil did not commit any crime, adding that “everything we have done to this point is within the purview of the dynamics of the business practice in throughput storage management worldwide which has been in existence over the nine years of our business relationship with the NNPC.”

The Capital Oil boss argued that the throughput contract it signed with NNPC “allows us to use stock in our tanks so long as we are able to return our customers within seven days of their demand and therefore such activity cannot under any stretch of imagination constitute stealing or any crime whatsoever.”

Ubah, who appeared to impress the committee, chaired by Hon. Akinlaja Iranola Joseph, in his submissions, expressed displeasure over the handling of the stock issues between it and the corporation.

He said: “Most unfortunate is the manner in which our mutual commercial issues were too quickly released to the media by NNPC without regards to the confidentiality of the transactions” as well as events which led to his detention for several weeks.

Ubah said his company had loaned millions of petroleum products from its storage to NNPC group without alerting or alarming the public, a situation that would have created serious panic and scarcity in the country if made public.
He said he was shocked and disappointed with the actions of the Ccorporation in publicising the issue and involving law enforcement agencies without fully exploring available dispute resolutions mechanism within the purview of the contractual relationship.

He said the unjustifiable actions had cost his company much injury and loss of patronage and goodwill and further resulted to loss of gainful employment of over 200 workers as a result of the company’s shutdown.
He said: “For the avoidance of doubt, we wish to reiterate that we have committed no crime, rather it is the NNPC group that has committed a wrong by destabilising our company.”