A Matter for the Court


EASTERN Electric, the reserve bidder for the Enugu Electricity Distribution Company, has sued the Bureau of Public Enterprises and the National Council on Privatisation for denying it the right to acquire 60 percent stake in the power firm. C. Don Adinuba, communication consultant to Eastern Electrics, said they have approached the Federal High Court in Abuja, to enforce its right to be invited as the reserve bidder of the Enugu Electricity Distribution Company, following the failure of the preferred bidder to meet the payment schedule.

Interstate Electrics had emerged as the preferred bidder for the Enugu Disco along other companies that bid for 15 electricity companies carved out of the Power Holding Company of Nigeria in October 2012. However, after the payment of $18.9m, representing 25 percent of the value of its bid price for the Enugu Disco, it failed to meet the August 21, deadline set by the BPE and ratified by the NCP chaired by Namadi Sambo, vice-president.

Although Interstate had approached the privatisation agency for an extension of time, the BPE declined until the expiration of the deadline for the payment of 75 per cent balance of the bid price on August 21. The eventual extension of time, however, pitched Atedo Peterside, chairman, technical committee, NCP, against Benjamin Dikki, director-general, BPE.

While Peterside leads those that insist that it was wrong for the BPE to grant Interstate an extension, Dikki, however, favoured an extension of time for the company to pay up. In an electronic mail, Peterside had advised against a possible extension of time for Interstate, adding that such would not only undermine the integrity of the transaction and the NCP, but would also translate into a financial discount to the preferred bidder.

Drop in Oil Earnings


THE contribution of the oil and gas sector to the Nigerian economy has declined significantly in the second quarter of 2013. The revenue accruable to the federal government from the sector dipped by N35.7 billion. The Central Bank of Nigeria, CBN’s Economic Report for the second quarter of 2013, revealed that oil revenue dropped by 1.93 percent from N1.849 trillion to N1.814 trillion at the end of the second quarter.

The breakdown shows that crude oil and gas sales depreciated by N35.3 billion or 8.04 percent to N403.8 billion from N439.1 billion at the beginning of the quarter. Petroleum Profit Tax, PPT, and royalties depreciated by N57.1 billion or 5.54 percent to end the quarter at N973.1 billion. There was also a decline in crude oil production and export by N307 billion, production dropped by $8.87 million or N150 billion, while export dipped by $9.32 million or about N157 billion. The CBN blamed the development on incessant pipeline vandalism, resulting from crude oil theft in the Niger Delta.

Meanwhile, Cordros Capital, in its Nigerian macroeconomic outlook, from July to December 2013, warned that a further decline in the price of oil in the international market would make Nigeria’s fiscal position unsustainable.

Youths on Rampage

MIDWESTERN Oil and Gas Limited, has explained the reason behind the recent attack on its production facility at Umusadege, Ndokwa West local government area of Delta State. The company revealed that it received a strange letter from youths in the area prior to the attack. The indigenous oil company in a statement said that a band of armed men invaded the production site at Umusadege.

Adams Okoene, MD Midwestern Oil and Gas
Adams Okoene, MD Midwestern Oil and Gas

“They molested some staff members in a dehumanising manner, and eventually shut down the company, after they over-powered the company’s security guards. The immediate reason for the attack is not known. However, two weeks before they struck, a certain group under the aegis of Umusadege Youth Forum had written two letters to the management of Midwestern Oil and Gas. They alleged that there is no regard to the constituted authority of our land, claiming also that the primary benefits accruable to the community are ignored. The incoherent letter further threatened that if the company did not respond to the issues raised, it will be compelled to take any action that will disrupt the smooth operation of our organisation,” the letter stated.

Midwestern Oil, which described the allegations as strange and unfounded, said the company has always been very active in the discharge of its corporate social responsibility, which has been through scholarship awards to the youths of the community, skill acquisition, renovation of classrooms, construction of roads and provision of potable water.

It added that the company has also been upholding its responsibilities in dealings with the legitimate representatives of the community in line with the corporate governance structure as enshrined in the executed memorandum of understanding, MoU.

Compiled by Anayo Ezugwu 

— Sep. 30, 2013 @ 01:00 GMT

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