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The House of Representative Committee on Local Content, led by Chairman, Boma Goodhead, has launched a probe into the alleged payment of the sum of $35 million, with 40 percent equity, to a company with a registration value of 10 million naira.
The Committee said the former management team of the Nigerian Content and Development Monitoring Board, NCDMB, headed by erstwhile Executive Secretary, Simbi Wabote, showed signs of alleged financial recklessness for investing a total of N14 billion naira for shares to a company one year after it was registered in 2020.
Recall, that the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, at a dinner in Lagos, accused the past executive of the NCDMB of wasting about $500m on questionable projects and loans, including investing $35 million for the Brass modular refinery in Bayelsa State without anything to show for it.
He said, “There is also the Brass Fertiliser, NCDMB also released a $20m, empty field. So, NCDMB has made some very bad investments. In this case, NCDMB has disbursed about $19Om in different equity investments, and none of them, apart from the Waltersmith modular refinery, can you say is worth a good investment. But the NCDMB under my leadership will not do a thing like that.
Hon. Boma Goodhead, during the hearing of the Committee with representatives of the NCDMB board, wondered how a company registered in 2020, not up to one year after its incorporation, was awarded a contract worth $35 million.
“The company was registered as a family company and has one naira per share capital of 10 million naira. How can the board pay 14 billion naira, by 40 percent to such a company? That simply means the company has just cash out on us. Taxpayers are used anyhow, if it were to be your own money will you go into such investments? How will you retrieve such money without equity?”
“Monies were just disbursed without due diligence, if you are claiming those funds are backed by CBN guarantee why haven’t you recovered them after the contract had expired.”
“The tenure for loan domiciled with Bank of Industries is 5 years, with the first set in 2018/2019. We have a document of 160 million out of 320 million dollars, which means 50 percent disbursement by the board, and you mentioned that you were proud of the business between the board and the bank, when recovery after expiry tenure is just 45 million dollars, resulting to a 30 percent bad business loan”
Responding, the Former Director of Finance & Personnel, who also doubled as Chairman, Investment Review Committee of NCDMB, Mr Isaac Iyalla and his Secretary, Mr. Abayomi, insisted that all contracts were approved and monies disbursed by the council, adding that all the processes required for disbursement were followed.
On the issue of awarding a contract worth $35 million to a company valued at 10 million naira and yet the project is being abandoned, Iyalla said the project is delayed due to the challenges encountered by the post-COVID era which had changed the dynamics of the projects and affected a lot of things.
He appealed to the committee that all necessary documents to back their transactions be provided, adding that some contract’s tenure were also extended due to COVID.
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