Chisauka Osita
Stakeholders in the oil and gas sector have expressed outrage that the $500 million Ogogoro Island, Lagos, development project has not seen the light of day, seven years after the contract was awarded to two indigenous companies.
They have therefore urged the federal government to order a probe into the $500 million contract, which was signed in 2013 to ascertain the actual amount released for the project, who authorized the releases and why the partners abandoned the project. This they said was “a sure way to convince Nigerians that indeed President Muhammadu Buhari is sincere in the fight against corruption.”
The two indigenous firms had in September 2013, signed the contract for the development of Ogogoro Island, Lagos as offshore facilities fabrication and maintenance hub.
The total cost of the project, which reportedly had the backing of the then petroleum minister, was put at $500 million, while the first phase – the dredging and reclamation of the Ogogoro Island site had been scheduled for completion in 2014.
The project partners had said at the contract signing then that the project would be handled in phases and would be financed with loans from former Skye Bank (now Polaris Bank) and the now defunct Diamond Bank as well as from the indigenous firms’ cash flow.
The proposed offshore infrastructure facility project when completed, the partners declared then, “would become the first of its kind in the entire West Africa, in terms of fabrication and maintenance of Floating Production Storage and Offloading Vessels (FPSOs).”
But seven years after the contract was signed, there is nothing on ground to show it will ever see the light of day, despite that the over $500 million allegedly released by the two banks on the directives of their top managements. It was gathered that a top Executive of one of the banks at the time, was Chairman of one of the firms that signed the “fake contract”.
Industry analysts have frowned on the deal, and argued that the “the whopping $500 million might have been used to sponsor some politicians during the 2015 election as there is nothing currently to show that the project is ongoing”.
A source hinted that “the money was part of the non-performing loans that contributed to the setbacks suffered by the two banks”, Diamond Bank was eventually acquired last year by Access Bank Plc.
Also in September last year, the Central Bank of Nigeria took over the Skye Bank, citing the lender’s failure to meet its minimum key liquidity and capital adequacy ratio. The bank was renamed Polaris bank.
The CBN had accused the board led by Tunde Ayeni (Chairman) and Timothy Oguntayo (Managing Director/CEO) of “Consistently failing to turn the fortunes of the bank around despite consistent warnings from the CBN. At the time of the takeover, Sky Bank as it then was had a negative net asset worth N1 trillion. Look out for more details…