The Economic and Financial Crimes Commission (EFCC) has reportedly begun investigating the $16 billion power project of the administration of former President Olusegun Obasanjo, Umaru Yar’Adua and his successor, Goodluck Jonathan.
According to The Nation, the commission may arrest key contractors involved in the failed project which had sparked controversy on the exact cost of the project as some people put it at $16 billion, while others say it is $13.8 billion.
The media outlet reports that about 18 top former and serving public officers, including two ex-ministers, may also be questioned.
The anti-graft agency may also interrogate some top officials of the Central Bank of Nigeria (CBN).
Preliminary investigation allegedly revealed that Rockson Engineering Limited got a chunk of the contracts worth about $2 billion.
The findings revealed that the transactions involving the firms implicated in the power contracts were characterized by absence of due diligence.
Citing a reliable source in the anti-graft commission, The Nation reports that a team of crack detectives had been put in place to interrogate the people involved in the scam.
“The operatives of the EFCC have launched a massive investigation into the alleged $16 billion power scam between 2006 and 2011 just as concerted efforts are being made to recover the humongous funds allegedly diverted into private pockets by different firms involved in the power project.
“The whole power project is $16 billion and anchored on generation, transmission and distribution.
“The project is being handled by the Niger Delta Power Holding Company (NDPHC). “It is instructive to note that the NDPHC belongs to the three tiers of government, namely the federal government, state and local governments.
“Investigators also discovered that most of the firms that secured contracts under the power project collected huge sums in naira and dollars but did not perform up to 30% before abandoning the project.
“Incidentally, most of the payments took place during the regimes of former Presidents Olusegun Obasanjo, the late president Umaru Yar’Adua and Goodluck Jonathan.
“The first amount released from the Excess Crude Account was about $8.3 billion,” the source was quoted to have said.
Another source cited by the newspaper claimed that some of the contractors will soon be invited by the EFCC for interrogation.
He also said that one of the major contractors, Rockson Engineering Ltd, is being allegedly taken over by the Assets Management Corporation of Nigeria.
He alleged that Rockson got four contracts and received over $2 billion in the following tranches: $180 million; $220 million; $240 million and $480 million.
The source further claimed that Rockson also received questionable $11 million and another N150 million.
“Investigation further revealed that despite the release of the above to Rockson, the firm was only able to execute 30 per cent of the construction.
“The firm also claimed that it imported certain materials since 2013 and lying in Onne Port without clearing,” the source added.
He said some officials of the CBN will be questioned for lack of due diligence in the manner in which the transaction was conducted.
“Instead of opening Letter of Credit (LOC) in the name of the manufacturers of the equipment for the power project, operatives discovered that the LOC was opened in the name of Rockson.
“Investigation also revealed that instead of the LOC being put in place in Form M (tangibles and specific), the LOC was opened in Form A (intangibles like school fees, medical bills, etc),” he was quoted to have said.
The EFCC might also review issues in the report of the House of Representatives Committee on the failed project.
The lower legislative chamber had recommended 18 top former and public officers, including two ex-ministers, for investigation by anti-graft agencies, especially EFCC and ICPC, following the investigation by the House committee headed by Hon. Ndudi Elumelu.
The issues raised by the Elumelu Committee were as follows:
No meaningful progress was made in the execution of power contracts.
Officials rushed to pay contractors in full even before engineering design for the projects had been completed and approved.
NIPP contracts were not only overpriced in comparison with PHCN contracts, they were also wide off the mark.
Widespread evidence of systematic over-scoping of projects in order to inflate costs both in PHCN and NIPP.
NIPP Distribution EPC contracts were awarded at costs averaging about 10 times the norm when compared to PHCN contracts.
The Ndudi Elumelu Committee was put in place by the House on January 31, 2008 to look into how much was spent on power projects.
In its report, the committee said that about $13.278 billion was spent on power projects between 1999 and 2007.
The committee recommended termination of 13 contracts and review of 10 projects.
About 15 contracting and consulting companies were asked to be investigated by the appropriate agencies.
“From the oral and documentary evidence, it was clearly established that the total expenditure in the power sector during the period 1999-2007 was US$13, 278,937,409.94billion.
“Indeed, had the supplementary budget of the power sector in 2007 been implemented, the expenditure could then have been over $16billion reported by the Honourable Speaker of the House of Representatives.
“There are also unfunded commitments to the tune of US$7.265billion for NIPP projects as at May 29, 2007.
“There is another US $1billion for PHCN capital projects awarded between 2000 and 2007, which have been captured in the 2008 Appropriation Act,” the report reads in part.
“In view of the apparent unwillingness of the CBN to cooperate with the committee in this matter or provide the committee with a proper account of withdrawals from Excess Crude account, the balance on the account, where the monies in respect of the unutilized Letters of Credit are kept and interest that have accrued thereto, we recommend that the EFCC be invited to investigate the Office of the Accountant-General of the Federation and the Central Bank of Nigeria in respect of the above issues relating to Letters of Credit opened,” the committee submitted.
An official in the media unit of the EFCC was subsequently quoted to have said: “We will do everything to recover the huge funds and prosecute indicted officials accordingly.”
