Economy
FG Sues Agip, Total For $635m Over Undeclared Cargoes
By Modupe Gbadeyanka
Two multinational oil companies, Agip and Total, have been sued by the Federal Government for $635million for undeclared crude oil shipped out of the country between 2011 and 2014.
Two cases have been filed at the Federal High court in Lagos by Professor Fabian Ajogwu (SAN), who had handled several cases for the FG on aviation, defence, energy, and financial services.
Hearing will begin next week before Justice Olatoregun Isola.
And there are indications that Prof Ajogwu will also be filing claims against other multinationals, such as Chevron and Exxon-Mobil.
The Nigerian Government in the two cases is claiming $490,517,280 from Total E&P Nigeria Limited and $145,848,102 from Nigeria Agip Oil Company Limited.
The statements of claim filed before the court are accompanied by the sworn affidavits of three US based professionals.
The Nigerian Government contends that sometime in 2014, it realised a decline in its oil export revenue.
This necessitated an intelligent gathering of data, which showed that part of the reasons for the decline was the under-declaration of crude oil shipments made by some major oil and gas companies operating in Nigeria.
Professor David Olowokere, a US citizen who is the lead Analyst at Loumos Group LLC, a technology and oil and gas auditing firm based in United States of America, Jerome Stanley, a counsel in the law firm of Henchy & Hackenberg, a law firm based in United States of America and head of the legal team engaged by Loumo Group LLC, made the court statements.
The third deponent is Micheal Kanko a citizen and resident of the State of Arizona United States of America, who is the founder and the current Chief Executive Officer of Trade Data Services Company.
A forensic analysis of export records from Nigeria and the import records from respective ports of entry at the United States of America used by Agip and Total showed discrepancies.
The volume of crude Oil declared to have been exported from Nigeria, was less than what was declared to have been imported into United States of America via the same shipment by the same vessel on the same bill of lading.
Some other shipments were not declared by the defendants to the requisite authorities, particularly the pre-shipments inspection agents. In some instances, the crude oil shipments were completely undeclared.
The plaintiff (Nigeria Government ) alleged further that all crude oil and gas shipments /exports from Nigeria are required to be declared and inspected by pre -shipment Agents appointed by the Central Bank of Nigeria of revenue due from the crude oil shipments.
The inspection records are to be deposited with ministry of finance Nigeria.
The Nigeria Government averred that high-technology information technology system including satellite tracking systems were deployed by consultants in gathering the various validated information establishing the shortfalls in the export declarations and the import declaration in the country of destination.
Court documents showed that 57 million barrels of Nigeria crude oil was illegally exported by Total E&P Nigeria Limited, Nigeria Agip Oil Company, Chevron and other companies and sold to buyers in the United States of America between January 2011 and December 2014.
The revenue due to Nigeria as a result of this under-declaration and non-declaration is $12,722,600,327 ($12.7billion) which translates to N2,493,629,664,092 (N2.5Trillion) at an official rate of 197 Naira to one US Dollar
In one of the instances cited, Total E&P Nigeria Limited shipped crude oil using a vessel by name Triathlon to Tostsa Total oil Trading SA of San Felipe Plaza-Suite 2100,5847SAN FELIPE, 770557-HOUSTON United States at the port of Philadelphia, Pennsylvania, United States of America with a bill of lading number TCVMTRIATIA 1388.
The shipment was not declared to the relevant authorities resulting in the shortfall of 968,784 barrels of crude oil in the value of $106,566240 as revenue to the Government,
Another under-declared crude oil was estimated at 491,850 barrels with a value of $54,103,500. It was shipped aboard a vessel named NORTH STAR and sold to BP Products North America of 501 Westlake Park Boulvard, Houston, TX 77079 United States, at port of Texas City, with bill of lading DROESVD23091101.
On two different occasions 768,990 barrels of crude oil, valued at $84,588,910 was loaded on a vessel named AUTHENTIC. It was shipped to Socap international limited of Cannon’s court, 22 Victoria Street, Hamilton, HM12.Bermuda at the port of Chester Pennsylvanian, United States bill of lading ALMYSVDM17041101 and17041102
The Nigerian government seeks an order of the court compelling Total E&P Nigeria Limited to pay into the FEDERAL GOVERNMENT OF NIGERIA account with the Central Bank of Nigeria, $245,258,640 being the total value of the missing revenues from the shortfall /under-declared/undeclared crude oil shipments of the Federal Government of Nigeria.
Government also wants the oil firm pay General damages of $245,258,640 and Interest on the said sum at the rate of 21 percent per annum until the entire sum is liquidated.
The case has been adjourned till next week for hearing.
In a separate suit, the Federal Government of Nigeria alleges that Nigeria Agip Oil Company Limited on 16 June 2014 lifted crude oil on board the vessel named VALUE. The firm shipped the cargo to Philadelphia Energy Solutions of 1735 Market street Philadelphia, PA USA at the port of Wilmington, Delaware, United States of America with Bill of lading number SEUK9HA21304143.
Government claims that the shipment was not declared to relevant authorities resulting in the shortfall of 175,334 barrels of crude oil in the value of $38,573,561as revenue to Federal Government of Nigeria.
On 27 June,2011,Nigerian Agip Oil Company limited lifted crude oil on board a vessel named COSMIC and shipped same to ENI TRADING &SHIPPING B.V. of Strawinskylaan 1641-Tower C/16 1077C XX. Again, government claims that the shipment was not declared to the relevant authorities resulting in a shortfall of 467,614 barrels of crude oil in the value of $107,274,990 as revenue to the Federal Government
Despite letters written by the legal representative of the Federal Government for payment of the shortfall, the company had failed to make any payments to the Federal Government.
The Federal Government of Nigeria now claims against Nigeria Agip Oil Company limited:
*An order compelling the company to pay into Federal Government of Nigeria ‘so account with central bank of Nigeria the total sum of $145,848,551being the total value of the missing revenues from the shortfall/under declared/undeclared crude oil of the Federal Government
*Interest at the rate of 21percent per annum until the entire sum is liquidated.
*General damages in the sum of $145,848,551.and the cost of this legal action.
There are imminent claims against other Oil exploration companies including Chevron.
http://guardian.ng/news/fg-sues-agip-total-for-635m-over-undeclared-cargoes/
By Modupe Gbadeyanka
The federal government has been asked by the Nigerian Bar Association (NBA) to suspend the implementation of the controversial tax laws.
In a reaction to the tax reform acts, the president of the group, Mr Afam Osigwe (SAN), the suspension of the laws would allow for a proper investigation into allegations of alterations in the gazetted and harmonised copies.
A member of the House of Representatives, Mr Abdussamad Dasuki, alleged that some parts of the laws passed by the parliament were different from the gazetted copy.
To address the issues raised, the NBA said it is “imperative that a comprehensive, open, and transparent investigation be conducted to clarify the circumstances surrounding the enactment of the laws and to restore public confidence in the legislative process.”
“Until these issues are fully examined and resolved, all plans for the implementation of the Tax Reform Acts should be immediately suspended,” the association declared.
It noted that the controversies “raise grave concerns about the integrity, transparency, and credibility of Nigeria’s legislative process.”
“These developments strike at the very heart of constitutional governance and call into question the procedural sanctity that must attend lawmaking in a democratic society,” it noted.
“Legal and policy uncertainty of this magnitude has far-reaching consequences. It unsettles the business environment, erodes investor confidence, and creates unpredictability for individuals, businesses, and institutions required to comply with the law. Such uncertainty is inimical to economic stability and should have no place in a system governed by the rule of law.
“Nigeria’s constitutional democracy demands that laws, especially those with profound economic and social implications, emerge from processes that are transparent, accountable, and beyond reproach. Anything short of this undermines public trust and weakens the foundation upon which lawful governance rests.
“We therefore call on all relevant authorities to act swiftly and responsibly in addressing this controversy, in the overriding interest of constitutional order, economic stability, and the preservation of the rule of law,” the organisation stated.
By Adedapo Adesanya
Demand for hot stocks, including MRS Oil Plc, buoyed the NASD Over-the-Counter (OTC) Securities Exchange by 0.52 per cent on Tuesday, December 23.
The energy company was one of the three price gainers for the session as it chalked up N19.69 to sell at N216.59 per share versus the previous day’s value of N196.90 per share.
Further, FrieslandCampina Wamco Nigeria Plc gained N2.95 to close at N56.75 per unit versus N53.80 per unit and Golden Capital Plc appreciated by 84 Kobo to N9.29 per share from Monday’s N8.45 per share.
Consequently, the market capitalisation went up by N10.95 billion to N2.125 trillion from N2.125 trillion and the NASD Unlisted Security Index (NSI) rose by 18.31 points to 3,570.37 points from 3,552.06 points.
Yesterday, the NASD bourse recorded a price loser, the Central Securities Clearing System Plc (CSCS), which gave up 17 Kobo to close at N33.70 per unit against the previous trading value of N33.87 per unit.
The volume of securities traded at the session went down by 97.6 per cent to 297,902 units from the previous day’s 12.6 million units, the value of securities decreased by 98.5 per cent to N10.5 million from N713.6 million, and the number of deals remained flat at 32 deals.
By value, Infrastructure Credit Guarantee Company (InfraCredit) Plc ended as the most actively traded stock on a year-to-date basis with 5.8 billion units exchanged for N16.4 billion. This was followed by Okitipupa Plc, which traded 178.9 million units valued at N9.5 billion, and MRS Oil Plc with 36.1 million units worth N4.9 billion.
In terms of volume, also on a year-to-date basis, InfraCredit Plc led the chart with a turnover of 5.8 billion units traded for N16.4 billion. Industrial and General Insurance (IGI) Plc ranked second with 1.2 billion units sold for N420.7 million, while Impresit Bakolori Plc followed with the sale of 536.9 million units valued at N524.9 million.
By Dipo Olowookere
It was another bullish trading session for the Nigerian Exchange (NGX) Limited as it closed higher by 0.59 per cent on Tuesday.
The market further rallied due to continued interest in large and mid-cap stocks on the exchange by investors rebalancing their portfolios for the year-end.
Yesterday, Aluminium Extrusion sustained its upward trajectory after it further appreciated by 9.96 per cent to N14.90, as Austin Laz gained 9.81 per cent to close at N2.91, Custodian Investment improved by 9.69 per cent to N38.50, and First Holdco soared by 9.35 per cent to N50.30.
Conversely, Royal Exchange declined by 7.22 per cent to N1.80, Champion Breweries shrank by 6.57 per cent to N15.65, NASCON lost 5.36 per cent to trade at N105.05, Sovereign Trust Insurance depreciated by 5.28 per cent to N3.77, and Japaul went down by 4.51 per cent to N2.33.
At the close of business, 29 shares ended on the gainers’ table and 27 shares finished on the losers’ log, representing a positive market breadth index and bullish investor sentiment.
This raised the All-Share Index (ASI) by 895.06 points to 153,354.13 points from 152,459.07 points and lifted the market capitalisation by N579 billion to N97.772 trillion from the previous day’s N97.193 trillion.
VFD Group finished the day as the busiest stock after it recorded a turnover of 192.0 million units worth N2.1 billion, GTCO exchanged 63.5 million units valued at N5.6 billion, Access Holdings traded 49.8 million units for N1.0 billion, First Holdco sold 45.8 million units valued at N2.3 billion, and Secure Electronic Technology transacted 38.3 million units worth N28.4 million.
In all, market participants bought and sold 677.4 million units valued at N20.8 billion in 27,589 deals compared with the 451.5 million units worth N13.0 billion traded in 33,327 deals on Monday, showing an improvement in the trading volume and value by 50.03 per cent and 60.00 per cent apiece, and a shortfall in the number of deals by 17.22 per cent.
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