Office of the President and Cabinet (OPC) has defied request by the Consumers Association of Malawi (Cama) to investigate and provide information to the nation on what happened to the royalties earned from Nigerian crude oil deal and the proceeds from Presidential jet sale.
Malawi in 2013 earned US$1,256.081.70 as royalties from crude oil deal it signed with Nigerian government in May 2012 and aside from “battering off” a controversial Presidential jet to offset a $19 million debt owed to Paramount Group.
Last month President Peter Mutharika, upon his return from United Nations General Assembly, lambasted the nation for remaining silent on the jet issue that was disposed of by the Peoples Party (PP) administration.
Cama has, however, expressed a shock with Mutharika’s sentiments considering that it has been demanding the Office of the President and Cabinet (OPC) to provide information on both the crude oil deal and the Presidential Jet.
In a letter Cama wrote OPC on October 9th, 2015 and Nyasa Times has a copy, the consumer body gave OPC a 14-day ultimatum to provide the information of which it has not.
“The Consumers Association of Malawi (Cama) is shocked that until today your office has failed to respond to our letters where we were requesting you to provide information on how the Presidential Jet was sold and the proceeds from the sale of the Nigerian Crude Oil that was donated to Malawi,” reads part of the letter signed by Cama’s Executive Director, John Kapito.
“As a matter of fact these were issues that were done under the Peoples Party administration, and after their removal from office we have continuously raised these issues with the current administration but we have never received any credible response,” said Kapito.
Cama has also complained about the Anti-Corruption Bureau’s (ACB) failure to investigate the two issues despite indicating to have received a complaint on the issues.
In the letter, Kapito accused OPC of failing to provide the President with accurate information on how the public are demanding information of national importance through the office.
Kapito highlighted that the Presidential Jet sale and the Nigerian crude oil deal was a Democratic Progressive Party campaign issue and the party promised the nation that once elected into power, would immediately investigate how the Presidential Jet was sold and how the proceeds from the crude oil were used.
“It is now surprising that after one year in power, the same issues that we have been demanding from the current administration which were also issues for its campaign have not been communicated to the public. And from our own observation, it seems that the President is not informed on critical issues that the public raise through your office and this is a disservice to the President.
“The question is, why then until today the current administration has failed to institute the investigations on the above highlighted issues? Your continued silence to provide us with information on what the PP administration did raises a lot of suspicions as we may conclude wrongly or rightly that you also benefited from the proceeds of the sale of the Presidential Jet and the Nigerian Crude Oil”.
According to information, Malawi earned US $1,256.081.70 royalties from the crude oil sale agreement spanned from May 1st, 2012 to April 30th, 2013. The money was transferred into
National Oil Company of Malawi (Nocma) Foreign Currency Dominated account for crude (Afcda) maintained at National Bank of Malawi.
Government was forced to contract Nocma to service the deal as an agent since it was unable to secure US$120 million required to purchase the crude oil.
Under the government-to-government deal, Nigeria agreed to supply Malawi with crude oil through the NNPC and allowed Malawi to either process or sell the crude, thus-as a buyer-after paying upfront $2.5 million (then over K1 billion) before making first uplift of the oil.
The contract gave Malawi approval to buy and sell 30 000 barrels per day of crude oil made up of several grades as specified in the lifting schedule for each month. This means that, effectively, the country was at liberty to buy and sell over half a million barrels a month.
The crude oil deal was signed by President Banda who pushed for the contract, first initiated by her predecessor late Bingu wa Mutharika in his attempts to solve chronic fuel shortages.
In November 2012, Petroleos De Geneve SA Limited (PDG) managing director Raymond Anyiam-Osigwe told Malawi’s daily that Lilongwe was getting US0.4 cents in royalties per barrel, which he said totalled $760 000 (over K300 million) by then.
He said Malawi had uplifted 903 691 barrels in August 2012 and 997 416 in the second phase in October last year, which is nearly two million barrels.
The Dassault Falcon 900EX Presidential jet bought in 2009 cost Malawi almost $22m, a move that angered western donors who claimed that the jet was partly bought using donor funds aimed at uplifting the impoverished citizenry.Follow and Subscribe Nyasa TV :