House Grills Oil Firms Over Dirty Fuel Imports

The House of Representatives’ Committee on Petroleum Resources (Downstream), on Tuesday, grilled two of the four contractors engaged by the Nigerian National Petroleum Company Limited via a Direct-Sale-Direct-Purchase deal in the importation of contaminated Premium Motor Spirit (petrol), which has led to a major disruption in the fuel supply chain in the country.

The two oil firms which appeared before the committee at its second investigative hearing include Emadeb/Hyde/AY Maikifi/Brittania-U Consortium and MRS Holdings.

Both companies denied any wrongdoing in the importation of off-spec fuel, arguing that the NNPC officials examined the petroleum product and certified it okay.

The committee, however, requested written submissions and documentary evidence of their claims.

The Group Chief Operating Officer, MRS Holdings, Amina Maina, in her presentation, said the Group Managing Director of the NNPC, Melee Kyari, had cleared MRS when he appeared before the committee last week.

Maina said, “Yes, there have been a lot of conversations regarding whether or not we brought in fuel which was contaminated. Let me state that there is an approved specification of PMS which is imported into Nigeria. That specification is the product which we brought and I think the GMD of the NNPC also attested to the fact that the product which we brought onboard the MT Bow Pioneer was tested at the load port (LITASCO Terminal, Antwerp-Belgium) and it met Nigeria’s specification.

“On arrival, it was tested by the NNPC inspectors; it met specification. Before the vessel was discharged, the normal procedure is that the NDMPRA will have their inspectors test and certify before it is discharged. And all of that was done and certified okay before the vessel was discharged.

“We did not bring in any adulterated fuel. We have all the load port documents which are basically the certificate of quality at the load port, the certificate of quantity, the bill of laden; all the documents.”

The Chairman of the committee, Abdullahi Gaya, noted that the lawmakers had engaged the NNPC and the Nigerian Midstream and Downstream Petroleum Regulatory Authority last week, “for them to explain and give us documents, and we have already informed them that after going through the documents, we are going to invite them again.”

Gaya added, “If we have any other thing that we need to verify, we will call them; they have to tell us. “For now, it is just for her (Maina) to explain, give us the documents, then, we will go through the documents. If there is the need to call her back, we will call her.”

When asked to confirm the information that Nigeria does not conduct methanol tests on supplies until now and the role of the Standards Organisation of Nigeria in conducting the test, Maina partly said, “That is correct. It is not in the Nigerian specification to test for methanol. I believe that the specification which we work with was issued by the Standards Organisation of Nigeria. It is their prerogative to decide what parameters they want us to check in line with global standards. To your question: is it normal? Yes, unless there is a specific need, you do not test for methanol.”

In his submission, Gaya said, “The issue is this: whatever specifications that are given to her, if they don’t comply, we will hold them responsible. Their own is a contract given to them with the specifications.

“So, if you were given a contract with particular specifications, and you decided not to bring it up to that standard, then we have every right to charge them. But based on the letter of the contract and the specification given to them, if they comply, then they don’t have any issue.”

Meanwhile, the Emadeb/Hydeia.Y Maikifi & Brittania-U Consortium disowned Brittania-U on the contaminated supply.

The MD/CEO, Emadeb Energy, Adebowale Olujimi, who spoke on behalf of the consortium, noted that following the participation of the respective companies in the 2021/2022 DSDP tender, the NNPC formed the consortium, with Emadeb as lead, on May 7, 2021.

According to him, the submission of an executed consortium agreement was one of the pre-requisites required by the NNPC for the final award of the DSDP contract.

Olujimi added that the consortium members, on June 16, 2021, executed a consortium agreement which defined the rotational responsibilities of members, sequential alternate crude lifting/petroleum product delivery and indemnification of other members against liabilities, claims, among others, that may arise during a member’s underperformance or failure to perform under the DSDP contract.

The Emadeb boss stressed that the consortium was awarded the DSDP contract on June 22, 2021, by the NNPC, while the delivery of the petroleum product and crude lifting had been done strictly on a rotational basis by the respective consortium members.

He said, “Some of the consortium members – Emadeb/Hyde and AY Maikifi – immediately engaged a reputable international company for delivery of all PMS cargoes and prompt loading of crude oil, while Brittania-U chose to engage a different entity for her own supplies.

“Brittania-U also preferred to liaise directly with the NNPC and took responsibility for all her transactions without recourse to the other consortium members. All evidence to substantiate Brittania-U’s position are attached for references.

“The other consortium members – Emadeb/Hyde and AY Maikifi – have successfully delivered 270,000MT of PMS, while Brittania-U also delivered 90,000MT.

“The PMS alleged to be methanol-blended was solely delivered by Brittania-U via MT Torm Hilde in January 2022. The other consortium members — Emadeb/Hyde and AY Maikifi – were not privy to the arrangements for the delivery of the aforementioned PMS and documentary evidence relating to the PMS.

“It is worthy to mention that Brittania-U should be allowed to provide all answers to the controversy surrounding the importation of the PMS product.”

“From this standpoint, other consortium members — Emadeb/Hyde and AY Maikifi – would like to crave your indulgence and request that you exempt us from this meeting. We also believe that you will let our citizens know that we were not part of the companies that imported the alleged methanol-blended PMS.”

However, Chief Executive Officer of Brittania-U, Uju Ifejika, pushed the responsibility on the NNPC, stating that the regulator examined the product and certified it okay.

Ifejika said, “We have a DSDP contract with the NNPC and we have done DSDP with the NNPC for two and a half years, and we have brought in 10 cargoes. This is our 10th cargo and none of our cargoes was off-spec. And this particular one was not off-spec. Before a cargo will come in, there will be a test at the port of loading, which they did at Antwerp. This time, our supplier, Petraco, did their sample at Antwerp and they gave us their sample result the which we gave to the NNPC, and NNPC confirmed it was okay.

“You can’t bring in the cargo without NNPC’s inspector jointly carrying out the initial test. And the test is here. We will present it to you. It met the specification.”