REVEALED: How Osinbajo approved $3m payment for gas project — without due process

The office of Vice-President Yemi Osinbajo says he follows due process in his dealings with agencies under his supervision — 

Recall that in September 2019 that President Muhammadu Buhari had directed Osinbajo to seek presidential approvals for agencies under his supervision.

Osinbajo is the chairman of the governing boards of the National Emergency Management Agency (NEMA), the National Boundary Commission (NBC) and the Border Communities Development Agency (BCDA).

He is also the chairman of the board of directors of the Niger Delta Power Holding Company (NDPHC), a limited liability company owned by the three tiers of government.

The directive to follow due process was issued via a presidential memo but in his response, Laolu Akande, spokesman of the vice-president, said Osinbajo always followed due process and described the report as “fake news”.

However, documents seen by TheCable showed that in January 2017, Osinbajo approved the payment of $3,072,644.76 and N140,405,826.30 being variation costs for a project under NDPHC without following the steps laid down by the Bureau of Public Procurement (BPP).

In a letter dated November 25, 2016, NDPHC sought the approvals as variation/claim order request for Kaztec Engineering Limited, contractor of the LOT 4 EPC gas project in Sapele, Delta state.

According to NDPHC, Kaztec had claimed that the payments for the gas contract awarded in 2009 were not sufficient and this compelled the company to take loans to complete the project.

In the response dated January 9, 2017, Osinbajo approved the payment — although BPP was yet to conduct its due process check on the claims.

The letter signed by Ade Ipaye, Osinbajo’s chief of staff, read in part: “I am directed by His Excellency, Prof. Yemi Osinbajo, SAN, Vice-President, Federal Republic of Nigeria, to acknowledge receipt of your letter dated November 25, 2016, on the above stated subject and to convey His Excellency’s approval of your prayer in paragraph 6 therein.”

DUE PROCESS NOT FOLLOWED

Interestingly, on February 15, 2017, five weeks after, NDPHC wrote the BPP seeking a certificate of no objection to pay Kaztec from $4,115,000.00 and N250,000,000. 00 — a provisional sum meant to repair the pipeline.

But in its due process review dated March 10, 2017, BPP said it could not grant the certificate because NDPHC “did not provide any explanation why the project duration was extended by additional 75 months above the 9 months completion period”.

Section 60 of the procurement act 2007 describes certificate of no objection as “the document evidencing and authenticating that due process and the letters of this act have been followed in the conduct of a procurement proceeding and allowing for the procuring entity to enter into contract or effect payments to contractors or suppliers from the treasury”.

The BPP also cited arithmetic errors in the submission by the NDPHC.

However, the BPP said the certificate could be granted on the “strength of the submission by the NDPHC particularly the approval by His Excellency, Mr. Vice President” — an obvious admission that the office was constrained the anticipatory action of a higher authority.

BPP also added that “this no objection is granted on the condition that the NDPHC will forward the detailed breakdown showing how the provisional sum has been expended so far”.

Akande could not be reached for reaction as he did not pick his calls or respond to text messages.