The Economic and Financial Crimes Commission (EFCC) on Wednesday detained two top officials of the Niger Delta Power Holding Company (NDPHC), the company which supervised execution of the $16 billion failed power projects.
The officials are Head of Finance Marvel Emefiele and Head of Compensation Eze M. C. Odigbo.
They are expected to account for the N850 million earmarked as compensation to communities where components of the power project were sited
Others in EFCC’s net are Managing Director of Pivot Engineering Mr. Richard Ayibiowu and the Managing Director of Chris Ejik Nigeria Limited Mr. Christain Ejik Imoka.
Detectives are on the trail 18 more suspects including two former governors, a former chairman of a bank and a former chairman of an airline.
About 15 more companies are also on the EFCC radar, it was learnt last night.
There are fears that some of the suspects might have secretly relocated abroad.
President Muhammadu Buhari has repeatedly wondered how $16 billion was spent on power and there is no electricity generated. He subsequently ordered a probe into the expenditure.
A source in the anti-graft commission said: “The NPDHC officials are being detained by the EFCC, following their alleged involvement in bogus payment and diversion of about N850 Million compensation to communities where the components of the power projects were sited.
“Investigation revealed that approval was granted for the payment of 84 Billion to the communities where transmission lines of the power project are meant to be laid.
“Investigators discovered that there were serious issues arising from the payment of the compensation to the communities.
“Though about N50 Billion compensation was said to have been paid to the communities, the contractors were said to have been prevented from working by the communities over non- payment of the same compensation which the NPDHC records claimed had been paid.
“Emefiele was said to have approved the payment of 850 Million as NPDHC Head of Finance while Odigbo, Head of Compensation reportedly effected the compensation to the communities. The two officials are being quizzed over the propriety of the matter.
“The Managing Director of Pivot Engineering, Mr. Richard Ayibiowu, is being detained over alleged payment of 350 Million to the communities. Part of LOT 8 of the power project, Ihiala /Orlu Transmission Line, was not executed by Pivot Engineering due to the alleged claim of hostility by the communities while about 350 Million was on record as paid to the same communities. Mr. Oba Otudeko is the chairman of Pivot Engineering.”
“The Managing Director of Chris Ejik Nigeria Limited, Mr. Christian Ejike Imoka, is being detained over controversial payment of 500 Million contract LOT 14, which ought to include Lekki-Ajah Transmission Line, which was not executed. But money was paid to that effect.
“The detained officials allegedly failed to honour previous invitations from the commission.”
The source said: “We have invited about 15 companies implicated in the mismanagement of funds meant for the power projects. One of the firms got four contracts but was only able to put in place 30 per cent of the construction. The firm also claimed that it imported certain materials since 2013 and lying in Onne Port without clearing.”
Many salient issues were raised for investigation by the 6th House of Representatives Committee, headed by Hon. Ndudi Elumelu, currently the Minority Leader of the House.
The issues raised by the Elumelu Committee are as follows:
- All NIPP payments were made without following Due Process
- No meaningful progress was made in the execution of power contracts
- Officials rushed to pay contractors in full even before engineering design for the projects have been completed and approved
- NIPP contracts were not only overpriced in comparison with PHCN contracts, they were also wide off the mark
- Widespread evidence of systematic over scoping of projects in order to inflate costs both in PHCN and NIPP
- NIPP Distribution EPC contracts were awarded at costs averaging about 10 times the norm when compared to PHCN contracts
The Elumelu Committee was set up by the House on January 31, 2008 to look into how much was spent on power projects.
In its report, the committee said about $13.278billion was spent on power projects between 1999 and 2007.
The committee recommended termination of 13 contracts and review of 10 projects.
About 15 contracting and consulting companies were asked to be investigated by the appropriate agencies.
The report reads in part: “From the oral and documentary evidence, it was clearly established that the total expenditure in the power sector during the period 1999-2007 was US$13, 278,937,409.94billion.
“Indeed, had the supplementary budget of the power sector in 2007 been implemented, the expenditure could then have been over $16billion reported by the Honourable Speaker of the House of Representatives.
“There are also unfunded commitments to the tune of US$7.265billion for NIPP projects as at May 29, 2007.
“There is another US $1billion for PHCN capital projects awarded between 2000 and 2007, which have been captured in the 2008 Appropriation Act.
“Additionally, the total commitment of the NNPC and its Joint Venture partners(of which the Federal Government, through the NNPC has an average of 51% interest) towards IPP power plants, gas sources development, gas transmission and metering of JV IPPs, PHCN power plants and NIPP power plants, according to the submission of the acting GMD of the NNPC is US$7billion, out of which about US$1.62billion has been expensed, leaving outstanding commitments of over US$5.5billion out of which the Federal Government will provide about US$3billion.
“Recognition of these unfunded commitments would bring the total (funded and unfunded) FGN expenditure commitments in the power sector to over US$24.5billion between 1999 and 2007.
“From the assessment done during the Committee’s tour of the project sites, it is safe to conclude that no meaningful progress was made in the execution of power contracts.
“It is curious and quite strange that officials rush to pay contractors in full even before engineering design for the projects have been completed and approved.
“NIPP contracts were not only overpriced in comparison with PHCN contracts, they are also wide off the mark when viewed against comparable power stations in several parts of the world.
“A comparable review of the cost of power installations in varied regions of the world such as South Korea, Saudi Arabia, U.S.A, Taiwan, Hong Kong, Mexico and Chile showed that $10billion could have built plants to produce between 5,000 to 6,000 MW of electricity. But this amount failed to do so in Nigeria.
“Unfortunately, all NIPP payments were made without following Due Process. In its place, a process called ‘Waiver of Due Process Certification for Payment’ was adopted in flagrant disregard of Due Process Policy, thus paving the way for dubious and highly risky payments to contractors and consultants by the Federal Government of Nigeria.”
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