Aniekan Bassey, Senator representing Akwa Ibom North-East
Senatorial District, has urged the Senate to investigate the controversial
Make-Up Gas (MUG) reprocessing deal involving the Federal Ministry of Finance,
Niger Delta Power Holding Company (NDPHC), Calabar Generation Company Limited
and Acugas Limited.
In a statement from Senator Bassey’s media unit, he made the call through a motion during Thursday’s Plenary.
Bassey noted that if the Senate fails to investigate the
circumstances under which the GSA and MUG were executed by the Federal
Government with Acugas Limited, these transactions would constitute an endless
drain on scarce public funds, which should have been applied towards the
execution of other pressing Government projects.
He, however, urged the senate to establish an Ad-Hoc
Committee and mandate the Committee to investigate the circumstances under
which the GSA and MUG arrangement was executed, the parties involved, payments
so far made to entities to date, the status of implementation of the GSA, and
for this purpose invite all stakeholders to the transaction, including the
Immediate past Minister of Finance, Budget and Economic Planning, Dr Zainab Ahmed,
the NDPHC, Acugas Limited, Calabar Genco, the Transaction Adviser engaged under
the MUG deal, etc ,and to report back within two weeks.
According to Senator Bassey, “The Niger Delta Power Holding
Company (NDPHC), a company owned by the Federal, States and Local Governments
in Nigeria to hold and manage Nigeria’s Independent Power Projects, sometime in
2017, entered into a GSA with Acugas Limited for the supply of gas to Calabar
Generation Company Ltd (Calabar Genco), a subsidiary of the NDPHC. Under the
GSA, the Federal Government of Nigeria is obliged to pay over $10million
monthly to Acusgas Limited and this monthly obligation was protected and
secured with a Take-or-Pay clause, implying that the monthly payment of over
$10million must discharged unfailingly by the Federal Government whether the
Calabar Genco takes delivery of gas or not.
“The discharge of the Take-or-Pay obligation by the Federal
Government has become a major concern to all well-meaning Nigerians because of
its huge burden on the public treasury as huge sums of money were paid to
Acugas even for gas not received or utilized by Calabar Genco.
“In a bid to get Nigeria out of this controversial
Take-or-Pay cul de sac and put in place an arrangement to reprocess and
redirect the gas for which Nigeria has paid for but not utilized over time, the
then Minister of Finance, Budget and National Planning, Zainab Ahmed, initiated
a MUG deal involving Calabar Genco and Acugas Ltd.”
The Senator further urged the Federal Government,
particularly the Office of the Attorney General of the Federation, to ensure
due diligence in the preparation and execution of transaction agreements with
companies and other investors to avoid the ugly scenario the government is
facing under the GSA with Acugas Limited and several other entities.
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