22nd November, 2013
Nigerian National Petroleum Corporation and its subsidiary, Pipelines and Products Marketing Company, are in the middle of a contract scandal over the supply of power to the company’s refinery in Port Harcourt, Rivers State
A contract process which commenced sometime in 2009 and involving officials of the Nigerian National Petroleum Corporation, NNPC, and those of its subsidiary, Pipelines and Product Marketing Company, PPMC, on one hand and one Hassan Ahmed Danbaba and his business partner, Akinwole Omoboriowo, on the other, has snowballed into a legal matter before a Federal High Court sitting in Abuja.
The suit was instituted by Danbaba, who claims that he and his business partner, Omoboriowo, by mutual agreement undertook to bid for the contract to supply power to the Port Harcourt Refinery through an independent power project. In pursuance of this agreement, Danbaba said, both decided to promote an offshore company and incorporate it as a special purpose vehicle for the purposes of the said contract.
Upon their agreement, they both approached officials of the NNPC and the PPMC at the Port Harcourt Refinery to discuss the project. The purpose was to extract guarantees from the officials that the national oil company and its subsidiary would buy electricity from the proposed offshore company which Danbaba and Omoboriowo had both agreed to promote and incorporate for the deal which was expected to run for about 30 years.
Danbaba said he and Omoboriowo held several meetings in several locations in Nigeria and in London with NNPC and PPMC officials for the purpose of finalising details of the proposed contract. Danbaba claimed that he funded these meetings, singlehanded, both for himself and Omoboriowo, as well as for NNPC and PPMC officials, including flight tickets, hotel bills and sundry expenses. Eventually, according to documents filed by Danbaba before the court, arrangements incidental to the award of the contract were concluded and awaited the approval of the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke.
However, Alison-Madueke, who initially withheld her approval for the contract award, sometime in 2011 approved it. Surprisingly, Danbaba said, her approval followed what is suspected to be an entirely different arrangement as Danbaba, who initiated the deal and brought in Omoboriowo, was factored out of the equation.
First, the agreed offshore business entity with which they pursued and concluded the deal was jettisoned and in its place, another company owned and managed by Akinwole Omoboriowo, which operates under the name of Genesis Electricity Company Limited, was awarded the contract for the supply of power to the Port Harcourt Refinery but without the knowledge of Danbaba. Genesis Electricity Company, which was not a party to the series of meetings, declarations, understandings and commitments that gave rise to the power supply contract, thus became the beneficiary of the contract whose exact value is still a classified secret.
According to court papers, Danbaba, upon realising that he’d been shortchanged in the deal, confronted Omoboriowo, who conceded that the contract had indeed been awarded and after pleading with Danbaba, promised to furnish him with the details, a promise he kept only in default. Repeated demands to Omoboriowo to honour their agreements on the contract deal also failed, as he allegedly rebuffed Danbaba, who brought him into the picture.
Court documents also indicate that parties privy to the agreements reached between Danbaba and Omoboriowo and who are listed as witnesses in the matter include Alhaji Umaru Shinkafi and Alhaji Ahmed Lawan Kuru. Danbaba also claimed that Omoboriowo enlisted the help of their mutual friends to help resolve their face-off over the contract but had repeatedly failed to show up for scheduled meetings, an indication that he merely seeks to buy time while he carries on with the contract without allowing Danbaba to take a nibble.
The aggrieved Danbaba accused Omoboriowo of not willing to reveal the details of the contract, despite his breach of trust which he (Danbaba) considers to be wrongful, fraudulent, malicious, wicked and condemnable. He lamented that he and Omoboriowo had come a long way and indeed had other joint business relationships, including their joint ownership of a company called Valternfields Utilities Ltd, where he (Danbaba) is the chairman and Omoboriowo is the managing director. He accused Omoboriowo of having a habit of reneging on contractual obligations owed to third parties and pointed out that several court cases are pending against him (Omoboriowo) for the enforcement of such obligations.
He also decried the untold hardship, embarrassment and financial hardship which he had been made to suffer on account of the incident, which he said had put his family and dependents in a very hard economic situation. He urged the court to award him N300 million, representing the cost he spent, upon the instigation and consent of the officials of NNPC and PPMC, for their trips abroad for meetings, hotel accommodation and other sundry expenses which he incurred in respect of the capital power supply contract.
Danbaba also wants the court to to make a declaration that the intentions, understandings and commitments expressed by himself and Omoboriowo in respect of the bid for the contract which was erroneously awarded to Genesis Electricity Company were binding on him and Omoboriowo. Furthermore, he wants the court to order the NNPC, PPMC, Genesis Electricity Company and Omoboriowo, to make a full disclosure of the details, terms and value of the contract.
Omoboriowo, a 1993 graduate of Economics from University of Jos and an alumnus of London Business School, says he has over 16 years experience in oil and gas as well as power sectors in Africa, where he claims to have consistently led other equally distinguished colleagues in pioneering several initiatives, including but not limited to African-owned and managed independent power producing companies, well structured oil trading companies, thriving utility companies, among others.
His work-history, according to entries made at his Linked In account, includes being an executive director of Christley Petroleum Ltd, managing director of Besse-Oil and Services Ltd, chief executive officer and co-founder of PPII, a foremost Oil and Gas Company in Africa with several trail-blazing marketing initiatives to its credit; vice-chairman of Vatternfields Utility Ltd (a utility company currently managing and operating pre-paid and Post-paid Revenue Collection initiatives in West Africa), and CEO of Genesis Electricity, GEL, Ltd.
He also serves as a board member of several international companies, including Walters Power Africa (a British Virgin Island company co-owned by GEL and a US-based company, owned by a former governor of Oklahoma, David Walters), Nagarjuna-Christley Fuels Ltd (a company now at advanced stage of deploying renewable energy investments in Ethanol production and supply in Nigeria); Avi Alliance Ltd, Alliance Energy Sao Tome Ltd, and several other international corporations. His expertise, according to him, lies in energy project deal structuring, negotiation, and business execution and strategy.
At the hearing of the matter last Monday, NNPC’s and PPMC’s lawyer, Mr. Sina Sofola, a senior advocate, while arguing his preliminary objection to the suit, told the court, presided over by Justice Adetokumbo Ademola, that the case was about a simple contract which does not fall within the jurisdiction of the court. He noted that it was the cause of action, and not the parties in a suit, which the court will look at to determine whether it has the jurisdiction to entertain the suit or not. He also faulted the institution of the case at this time, two years after the contract was awarded, and contended that it was outside the the 12-month period provided for in section 12 (1) of the NNPC Act and therefore statute-barred. The senior advocate further averred that NNPC and the PPMC were never served with any pre-action. He considered this unconstitutional and inconsistent with the provisions of Section 6 (6) (b) of the Nigerian Constitution.
Finally, Sofola argued that the case was really between Danbaba and Omoboriowo, who sat together and agreed on certain things on their own without any input by the NNPC and the PPMC. He urged the court to hold that no cause of action was raised against his clients and to release them from the suit while Danbaba and Omoboriowo settle what is a dispute to themselves. “We are raising jurisdictional issues here, Sir. I urge you to strike out this action against the NNPC and the PPMC as the matter is statute-barred,” Sofola pleaded with Justice Ademola.
Omoboriowo and his Genesis Electricity Company, that filed no process in the suit, simply associated themselves with the submissions of Sofola and urged the court to dismiss the matter. Danbaba’s lawyers from the chambers of Okon Efut, also a senior advocate, led by Mr. Oghenekaro Kelvin Rugbere, pleaded with the court not to decline jurisdiction in the matter but to do substantial justice to the case. He argued that what was in issue was not a simple contract but a challenge to the administrative action of the NNPC and the PPMC which led to the erroneous award of a contract to a company which did not participate in the bidding process, and contended that the court has the jurisdiction to look into and entertain the suit.
Danbaba’s lawyers also pleaded with the court to make an order of specific performance, directing Omoboriowo and Genesis Electricity Company Ltd to honour the terms agreed between Omoboriowo and Danbaba. They also contended that issuance of pre-action notice and section 12(1) of the NNPC Act runs foul of constitutional provisions and should be disregarded by the court.
On the late institution of the case, they noted that Dambaba was misled by officials of the NNPC and PPMC as well as Omoboriowo, who assured him (Danbaba) that everything would be resolved peacefully before any step would be taken in the execution of the contract. An assurance he came to realise was aimed at shielding him away from the contract proceeds.
Justice Adeniyi reserved his ruling on the preliminary objection for a date that would be communicated to the parties.
—Nnamdi Felix/Abuja