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NNPC Scandal: I Only Approved 2 JV Financing Arrangements Not Contracts - Osinbajo

13 October 2017

According to him, Government alone can not plug the infrastructural deficit of the country, that is why the Federal Government welcomes the private sector to take the lead.

He said he made the clarification in view of media enquiries that followed NNPC's claim that the contracts were indeed approved by Osinbajo.

He added that the Vice President approved the contract in his capacity as the Acting President when the President was from the country.

The Vice Presidential Spokesman, Mr Laolu Akande, gave the explanation on his twitter handle on Thursday.

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In a memo leaked to the media last week, Kachikwu accused the Nigeria National Petroleum Corporation (NNPC) of awarding $25 billion contracts without passing through him or the NNPC board.

According to the tweets, the huge backlog of unpaid cash calls were inherited by the current administration and the approval was meant to stimulate the required investments in oil and gas sector. "Action necessary to deal with a huge backlog of unpaid cash calls which Buhari adm. inherited and also to incentivize much needed fresh investments in the oil & gas sector". "Presidential approval were for financing arrangements not contracts says VP Osinbajo", Akande said he was issuing a clarification to correct his earlier tweet.

But contrary to the position of the Vice President that what he approved were for financing arrangements, NNPC in a statement earlier said it received presidential approvals for two oil contracts on July 10 and July 31 worth $1 billion and $780 million, respectively.

"While the President was away, I granted authorization which is what the law provides".

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He had also alleged that the $25 billion contract was struck without consulting the office of the Minister of State for Petroleum Resources or the board of the corporation.

"The Corporation shall not, without the approval of the President, borrow any sum of money whereby the amount in aggregate outstanding on any loan or loans at any time exceeds such amounts as is for the time being specified by the President".

"The NPDC production service contracts have undergone due process, while the AKK contract that requires [Federal Executive Council] FEC approval has not reached the stage of contract award", it added.

"Furthermore, subsection (4) provides that "Where any sum required aforesaid - a.is to be in currency other than Naira; and b.is to be borrowed by the Corporation otherwise than temporarily, the Corporation shall not borrow the sum without the prior approval of the President". "It is therefore inappropriate to attach arbitrary values to the shortlists with the aim of classifying the transactions as contracts above NNPC Tenders Board limit".

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NNPC Scandal: I Only Approved 2 JV Financing Arrangements Not Contracts - Osinbajo