Connect with us

News

FG Sues Oil Firm Over $3bn Unpaid Taxes

Published

on

The Federal Government, through the Office of the Attorney-General of the Federation, has commenced legal proceedings against Addax Petroleum Development Nigeria Ltd, a Chinese-owned oil firm, over the company’s alleged under-remittance of $3billion in taxes and royalties.
Documents before Justice Mojisola Olatoregun showed that the funds are outstanding claims against the company under the Petroleum Profit Tax Act and Petroleum (Drilling and Production) Amendment Regulation 2003 over Oil Mining Leases (OMLs) 123, 124, 126, and 137.
Joined as respondents are Addax Petroleum Development Nigeria Ltd, Addax Petroleum Exploration Nigeria Ltd, the Nigerian National Petroleum Corporation (NNPC), the Ministry of Petroleum Resources, Department of Petroleum Resources, and the National Petroleum Investment and Management Services (NAPIMS).
D.A. Awosika and Partners, counsel representing the Federal Government, stated that the $3billion unremitted funds came as a result of the oil multinational’s illegal and irregular reliance on side letters dated November 21, 2001, December 20, 2001, and August 24, 2004, that were never gazetted.
The government moved to recover the funds from Addax after report on how the Chinese firm allegedly paid millions of dollars in bribes to Nigerian officials to secure juicy contracts in the oil industry.
In 1998, Addax Petroleum, a subsidiary of China’s Sinopec Group, one of the world’s largest oil and gas producers, entered into a Production Sharing Contract (PSC) with the NNPC (as concessionaire) in respect of OPL 98/118 and OPL 90/225.
Four years later, the company discovered oil in commercial quantities and the OPLs were converted into Oil Mining Leases (OMLs) 123/124 and 126/137.
The PSC entered by the two parties required Addax Petroleum to pay royalties on any oil produced from the relevant oil blocks at the rate of 20 per cent as stipulated by law. It also provided that the Petroleum Profit Tax Act (PPTA) applicable to the contract areas shall be 65.75 per cent for the first five years, starting from the first day of the month of the first sale of the oil, and 85 per cent thereafter.
D.A Awosika & Partners are insisting that Addax Petroleum fraudulently obtained a side letters in 2001 and 2004 that were “never gazetted” and which they used in calculating their taxes and royalties.
The calculations in the side letters fixed the PPT payable by the company at 60 per cent, and rather than the 20 per cent flat rate of royalty, provided for a graduated rate depending on the volume of oil produced from the oil blocks.
The said letters were signed by then Special Assistant on Petroleum and Energy to former President Olusegun Obasanjo, Mr. Funsho Kupolokun, in 2001 and the then Director General/Special Adviser on Budget to the President in 2004, Mr. Olabode Agusto.
“Several objections and protests were raised by Federal Inland Revenue Service (FIRS), NNPC, and DPR to the reliance on these side letters by the defendants to bypass, supplant, and subvert the process,” the government’s lawyers stated.
“In 2003, in order to give effect to the graduated royalty regime stated in the side letters, the Minister of Petroleum Resources (Obasanjo) issued the Petroleum (Drilling and Production) Amendment Regulations, which provided for graduated royalty rates for onshore and shallow offshore PSC which did not account for royalty by tranches.
effect from the first day of January, 2000, which was the same date of commencement of the graduated royalty rates contained in the side letters.”
Several meetings between Nigerian government officials – represented by the FIRS, DPR, and NNPC – and representatives of Addax Petroleum reassess and resolve the latter’s “colossal underpayment” to the government between 2007 and 2012 yielded no results.
But Addax Petroleum maintained its right to the use of the side letters for computing the taxes on its operations and dragged the government over accusations of a breach of their 1998 PSC on the oil blocks.
In suit FHC/ABJ/CS/1099/2014 filed before former Chief Judge of Federal High Court Ibrahim Auta, the company sought a judicial approval towards their continued use of the side letters to compute its financial obligations to the Nigerian government.
However, on May 26, 2015, three days before the administration of the then president, Goodluck Jonathan, handed over to his successor, Muhammadu Buhari, the government negotiated a controversial out-of-court settlement with Addax Petroleum, agreeing to pay the company $3.4billion (about N1trillion).
Court papers filed by the Nigerian government’s lawyers stated that Addax Petroleum “surreptitiously teamed up” with some officials of DPR, FIRS, and NNPC to execute certain terms of settlement that were eventually made the Consent Judgment of court, notwithstanding the pendency of several applications yet to be heard by the same court.
“In executing the said terms of settlement, the authorities were not sought, no approval at Federal Executive Council level was given, the governing boards of the FIRS, NNPC and DPR did not authorise those officers that executed the bogus terms of settlement to so act,” the lawyers argued.
However, when President Muhammadu Buhari’s assumed office, the NNPC in a letter to Addax Petroleum endorsed by the president and dated September 7, 2015, reversed the agreement entered into by the previous administration.
In the ongoing suit before Justice Olatoregun, the federal government is seeking an order directing the NNPC, Ministry of Petroleum/DPR, and NAPIMS from further allocation of crude oil explored from OMLs 123, 124, 126, and 137 to Addax Petroleum pending when the company furnishes the court verifiable Bank Guarantee from Nigerian banks to cover the monetary claims of the plaintiff.
Other prayers sought by the Nigerian government include an order restraining the NNPC, Petroleum Ministry, and NAPIMS from dealing with Addax Petroleum, as well as stopping them from transferring or assigning their interest in the OMLs to another person.
Also, an order compelling the Nigerian agencies to file an affidavit of fact detailing the company’s assets, properties, and funds.
On Friday, Justice Olatoregun granted an order for the government’s lawyers to serve court papers to the NNPC, the third respondent in the suit, whose office is situated in Abuja, outside the court’s jurisdiction.
She thereafter adjourned the suit till May 3, 2018.

Continue Reading

News

Bonny-Bodo Road: FG Offers Additional N20bn, Targets December Deadline

Published

on

The Federal Government has agreed to offer additional N20.5 billion for the completion of the Bonny-Bodo road project in December.
The government, however, said if the construction company, Julius Berger, was not ready to accept the offer, the contract will be terminated.
Minister of Works, David Umahi, said this during a meeting with the Managing Director of Julius Berger, Lars Ritcher and members of Bodo-Bonny Road Peace Committee, on Wednesday in Abuja.
The reports that Julius Berger had requested asking for a N28 billion variation on the 82 per cent completed project.
The company hinged its request on the rise in exchange rate, construction materials, and diesel among others.
Umahi, however, said the government was willing to provide N20 billion out of the N28 billion that Julius Berger requested for.
According to him, the Bonny-Bodo road contract which was initially awarded at the cost of N120 billion in 2015, was later varied at N199 billion with a completion dateline of December 2023, which has since elapsed.
The Tide’s source recalls that in 2017, an agreement between the Federal Government, Nigeria Liquefied Natural Gas (NLNG) and Julus Berger on modalities for funding the project cost of N199.923 billion, without any further increase.
“If you do not accept the Federal Government’s offer by Friday and resume work on the site, the previously expired 14-day ultimatum for termination of project will be enforced.
“I want to let you know that we are the client. No contractor will dictate for this ministry, and there is no job that is compulsory that a particular contractor must do.
“We give you an offer. If you do not like the offer, you walk away. You don’t force us or we don’t force you.
“Agreement of contractual relationship is a mutual understanding,’’ the minister said.
Umahi said that had Julius Berger adhered to the project timetable, the project would have been completed on schedule before the impact of foreign exchange.
“Our position is very simple, we reject the conditions of Julius Berger totally and we ask Berger to please go back to the site to complete the project based on our offer.
“Our offer is unconditional and we say, accept or reject, so you cannot subject our offer to your conditions ,’’ he added
Umahi said the company should be humble in its dealings and exhibit solidarity during challenges.
Earlier, Richter had explained that the company suspended work on the site to seek some clarifications from the ministry.
According to him, the company asked for the augmemtation of N28 bilion because as at the time the contract was awarded the exchange rate was N305 to a dollar and diesel was N350 eor litre.
“We will still require some outstanding materials; that means that the initial agreement can’t fly because the variation of project is not sufficient and the exchange rate is also not in our favour to compensate the additional costs.
“That is why we decided to go back to our original proposal of the augmentation. Augmentation is a very normal process for all contracts,” the managing director said.
Chief Abel Attoni, Palace Secretary, Bonny Kingdom, expressed gratitude to President Bola Ahmed Tinubu over the decision to complete the Bodo-Bonny road project.
Attonu urged the parties to be patriotic and make the necessary sacrifice for the actualisation of the project.

Continue Reading

News

Court Vacates Arrest Warrant Against Ehie, Five Others

Published

on

The Federal High Court, sitting in Abuja, yesterday, set aside the warrant of arrest against Rt. Hon. Edison Ehie, the Chief of Staff, Government House, Rivers State, and five others.
Justice Emeka Nwite stated this while delivering his ruling in an application seeking to vacate the warrant of arrest which he issued on January 31, 2024.
The Judge said he was misled by the police in ordering the arrest of Ehie in connection with the burning of the Rivers State House of Assembly on October 30, 2023.
The Police, had told the court that Ehie and five others masterminded the bombing of the Rivers State House of Assembly amid a plot to impeach Rivers State Governor, Siminalayi Fubara.
The five others are Jinjiri Bala, Happy Benedict, Progress Joseph, Adokiye Oyagiri, and Chibuike Peter, alias Rambo.
Justice Emeka Nwite while setting aside the warrant said it has now become a mere academic exercise.
The judge further granted same to the 2nd to 5th Defendant/Applicant in same suit.
Femi Falana, SAN, and Oluwole Aladedoye, SAN, who appeared for the defendants in separate suits, held that the court lacked the jurisdiction to have granted the order.
While Falana filed a motion seeking an order to set aside the January 31 order by Justice Nwite, Aladedoye applied for a stay of execution of the arrest order.
In a motion marked: FHC/ABJ/CS/112/2024 dated February 2 and filed on February 7 by Falana, Ehie sought two orders, including “an order setting aside the order made on January 31 for want of jurisdiction.
“An order of this honourable court staying the execution of the order made on the 31st January 2024, pending the hearing and determination of this application.”
Giving six grounds of argument, Falana argued that the complainant had not filed any criminal charge or motion before the court.
The senior lawyer argued that the court lacked the territorial jurisdiction to entertain the ex-parte application as the alleged offences of conspiracy, attempted murder, murder and arson took place in Port Harcourt, the state capital.
“He submitted that the court lacked the vires to grant an application to arrest and declare his clients wanted in respect of the alleged offences.
“The complainant/respondent (IG) did not adduce evidence of terrorism in the affidavit in support of the application.
“The complainant/respondent did not cite any section of the Terrorism Prevention Act, 2013 (as amended) alleged to have been contravened by the applicants,” he argued.
Aladedoye in a motion on notice dated and filed February 9, on behalf of the five defendants, sought two orders, including
“an order staying execution or further execution of the order(s) of this honourable court made on the 31st of January, 2024, pending the hearing and determination of the appeal filed by the applicants.
“An order of injunction restraining the complainant from carrying out or further carrying out the orders of this honourable court made on the 31st January 2024, pending the hearing and determination of the appeal filed by the applicant in this case.”
Giving a three-ground argument, Aladedoye said that a notice of appeal had already been filed against Justice Nwite’s orders.
According to the senior lawyer, the notice of appeal contains grounds that challenge the jurisdiction of the honourable court.
The Inspector-General had, in a charge marked: FHC/ABJ/CR/25/2024, arraigned the defendants on a seven-count criminal charge bordering on terrorism and murder.

Continue Reading

News

13 Students Bag First Class, 182 PhD As IAUOE Graduates 5,550, Today

Published

on

The authorities of Ignatius Ajuru University of Education (IAUOE), Rumuolumeni, in Rivers State, have stated that 13 students will be graduating with first class while 182 graduands will bag Ph.D during the 42nd convocation ceremony of the university billed to hold today and tomorrow.
The Acting Vice Chancellor of the University, Prof. Okechuku Onuchuku, disclosed this during pre-convocation press briefing held in his office, yesterday, to unveil the programme for the convocation ceremony.
Onuchuku said that the 13 students were among the 4,653 graduands expected to graduate for the 2022/2023 academic session with first degree, while 897 students will be graduating with postgraduate degrees.
The Acting Vice Chancellor while giving the breakdown stated that 13 students made first class, 890 students bagged second class upper while 2,739 students had second class lower for first degree.
He further stated that 182 graduands bagged PhD, 667 got master’s degree and 48 got postgraduate diploma, adding that the convocation ceremony will hold today and tomorrow for first degree graduands and postgraduate graduands respectively.
He said that a total of 47 programmes out of the 54 programmes being undertaken at the first degree levels had been given full accreditation by the National University Commission (NUC) as well as all the programmes at the postgraduate school.
“We have ensured that our programmes both at the first degree and post graduates are in line with the NUC stipulated guidelines and speculations. We have also ensured that we are in line with both our academic and administrative policies,” he said.
Prof. Okechukwu urged the graduating students of the institution to always remember to use thier positions to help their alma mater as well as project the institution in a good image in the larger society.
“Try to ensure you finish any project you want to do, evaluate it first and avoid unfinished or abandoned projects. We will be graduating first degree graduands on Friday while Saturday will be for postgraduates, “he added.
Prof. Onuchukwu also said his administration had achieved a lot since he assumed office as Acting Vice Chancellor, stressing that his administration had improved on the welfare of the staff and the students.
“There are a lot of projects completed in the school; we have also given scholarship to some students and also encouraged departments to do same. We also impacted positively on our host communities”, he said.

Akujobi Amadi

Continue Reading

Trending