Lessons from the P & ID case, By Sam Kargbo

The Case of Process & Industrial Development (P & ID) should motivate us to pay attention to the Offices, Ministries, Departments and Agencies of the Federal Government that are established and empowered to exercise the executive powers of the President.

There is hardly any Nigerian who does not have his or her self-invented negative characterization of Nigeria’s President, Asiwaju Bola Ahmed Tinubu (BAT). No President of the country has been better than his predecessor in the estimation of the generation he is governing. The reason may not be separated from the fact that Nigerians are getting more aware by the day of the responsibility of the Government and are as such fashioning higher standards to assess Presidents and Public officers and give value to their performance. But not too many of us spare the time to scrutinize and respond to the activities of the Vice President, personal staff of the President (including the Chief of Staff, Secretary to the Government of the Federation, Special Advisers, Special Assistants and sundry domestic staff), Ministers, Officers in the Public Service of the Federation, the Civil Service, Departments and Agencies of the Federal Government.

Whilst some people were quick to express critical views about the number of Ministers that President Bola Ahmed Tinubu has appointed, not too many are aware that Nigeria presently has more agencies than ministries and that some of these agencies are more critical to the life and sustenance of the country than many ministries combined. Examples of the agencies that constitute the lifeline of Nigeria are the following:

1. Bank of Industry (BOI)
2. Budget Office, Federal Ministry of Finance
3. Bureau of Public Enterprises (BPE)
4. Central Bank of Nigeria (CBN)
5. Corporate Affairs Commission (CAC)
6. Debt Management Office (DMO)
7. Department of Petroleum Resources (DPR)
8. Economic and Financial Crimes Commission (EFCC)
9. Energy Commission of Nigeria (ECN)
10. Federal Aviation Authority of Nigeria (FAAN)
11. Federal Housing Authority (FHA)
12. Federal Inland Revenue Service (FIRS)
13. Independent Corrupt Practices & Other Related Offences (ICPC)
14. Independent National Electoral Commission (INEC)
15. Industrial Training Fund
16. National Agency for Food and Drug Administration and Control (NAFDAC)
17. National Bureau of Statistics (NBS)
18. National Council on Privatisation (NCP)
19. National Orientation Agency (NOA)
20. National Planning Commission (NPC)
21. National Examination Council (NECO)
22. National Economic Empowerment & Development Strategy (NEEDS)
23. National Poverty Eradication Programme (NEPAP)
24. Nigeria Customs Service (NCS)
25. Nigerian Ports Authority (NPA)
26. The Nigeria Export Processing Zones Authority (NEPZA)
27. Nigeria Immigration Service (NIS)
28. National Health Insurance Scheme (NHIS)
29. Nigeria Deposit Insurance Corporation (NDIC)
30. Nigerians in Diaspora Commission (NiDCOM)
31. Nigeria Investment Promotion Commission (NIPC)
32. Nigerian Maritime Administration and Safety Agency (NIMASA)
33. Nigeria National Petroleum Corporation (NNPC)
34. Nigeria Stock Exchange (NSE)
35. Nigerian Air Force (NAF)
36. Nigerian Army (NA)
37. Nigerian Navy (NN)
38. Nigerian Communications Commission (NCC)
39. Nigerian LNG
40. The Nigeria Police Force (NPF)
41. Power Holding Company of Nigeria (PHC)
42. Security and Exchange Commission (SEC)
43. Service Compact with all Nigerians (SERVICOM)
44. The Standards Organization of Nigeria (SON)

These agencies are established and vested with specific mandates for the overall goals of democratic governance and the purpose of the State. Because of the crucial nature of their roles and functions, they are insulated from the rigidity and routine of Civil Service Rules and are meant to run independently as specialized agencies with the highest – of and most effective and competitive – bureaucratic standards. They are by law hived and corralled in their respective islands and ensconced behind the shields of merit and professionalism. They are not only expected to pay humongous salaries and perquisites but to attract high-end productive professionals from society. If the agencies of the Federal and State Governments work in full throttle and with the expected efficiency, the road to growth and development will be shortened and Nigerians will enjoy a higher standard of living. But alas, not only are they inefficient, they have turned out to be the conduits for the syphoning of public wealth and the suppression of the Nigerian! These agencies are, in general, Lords unto themselves. They are not accountable, and transparency is not origin to them. I will demonstrate this point with a few examples.

The CBN
Until the reign of Godwin Ifeanyi Emefiele, CFR, some of us had regarded the Central Bank of Nigeria (CBN) only in terms of its role as Nigeria’s apex monetary authority. Those in the financial and banking sector may go further to defer to its powers to maintain the external reserves of the country, promote monetary stability and a sound financial environment, and be the banker of last resort and financial adviser to the Federal Government. Not even the National Assembly could suspect that the letters and provisions of the CBN Act are loose to the extent of allowing an ambitious and overbearing CBN Governor to appropriate it and use it as a tool to further political ambition. The CBN Governor was therefore unscrutinized and left to enjoy extensive and near absolute powers in its interventions in identified sectors of the economy. He could, at his own choosing, activate the CBN to lend directly to consumers and even, in some cases, bypass the commercial banks in such transactions.

Feeling at large, Emefiele became audacious and provokingly brazen. He picked up forms to contest the primaries of the ruling All Progressives Congress (APC) and manipulated the then President to embark on the ill-fated and destructive recall of specified Naira notes and their replacement with newly designed and printed ones on the false claim that the exercise would fight banditry and vote buying. As it later turned out, the policy was fashioned and hurriedly implemented on the eve of the February 2023 presidential election to overreach the suspected leverage of the flagbearer of the APC. In the trail of that tragedy are tales of massive corruption in the CBN. The dangers of corruption originating and residing in the CBN are unimaginable. And yet, the public, media, civil society, anticrime and prosecutorial agencies, and, in particular, the National Assembly that is vested with oversight powers in the form of anticorruption investigations and the conduct of hearings to procure concrete evidence on corrupt practices, have let the CBN be. Today, the Naira is in a freefall and we connivingly pretend not to know why.

The Oil and Gas Industry
If the CBN is corrupt and incapable of delivering on its mandate, what can we say about the agencies of the Federal Government in the Petroleum Industry?

Being second to Angola in oil production in Africa, Nigeria’s annual budget has always been largely supported by the income and revenue it earns from the oil sector, though the sector’s contribution to the country’s GDP has hardly been beyond 9%. This national cash cow has attracted all manner of “investors” and hustlers who have captured the sector and appropriated it. That is why a country so rich in oil is so poor and unable to provide modern infrastructures and efficient public utilities or build and maintain good public institutions and bureaucracies for efficient public services and fair, equitable and efficient distribution and redistribution of public wealth and resources for the enhancement of growth and development. This contradiction is not promoted or justified by a lack of capacities or know-how. The worst culprit is corruption. The sector has produced individual domestic and international billionaires than any other industry on the continent. Sadly, a critical trace of such individual wealth may hit the laxity and permissive nature of the sector. The P & ID case, which exposed Nigeria to a dubious debt of over US$ 11 billion that originated from a satanic scheme orchestrated and implemented by unscrupulous foreign hustlers loudly demonstrates how international crooks and their cheap and infernally treacherous domestic collaborators feast on the sector. Of course, the question that naturally comes to mind is: Why is corruption so endemic in the sector when we have the Economic and Financial Crimes Commission (EFCC) and the Independent Corrupt Practices & Other Related Offences Commission (ICPC)? Part of the answer has been highlighted by regulatory failure and the absence of public scrutiny. Much of it could be gleaned from the origin and modus operandi of P & ID and its kind in the sector.

Briefly, Mr Michael Quin and Michael Cahill – who, far back as 1992, had executed contracts for the NNPC in Nigeria – registered a company named Industrial Consultants (International) Ltd (ICIL Ltd) in 1979 in Ireland. In 1997 they incorporated ICIL LTD in Nigeria and brought Mr James Nolan, a long-term employee, and Adam Quin, one of the two sons of Michael Quin, to run it for them. Through ICL Ltd, Quin and Cahill procured and executed military contracts. As they perpetuated and entrenched themselves into the Nigerian system, they diversified their contract portfolios under different sister companies to ICIL Ltd. Although there is no evidence of their ever importing capital into the country, they were the toast of the Ministries of Defence and Police in the execution of humongous contracts denominated in foreign exchange.

Being high players in such strategic sectors as Defence and Police, they were in a vantage position to know policy shifts and directions of the Federal Government, which explains the proliferation of companies under their kitty. With their track record as executors of military and police contracts, it was easy for them to penetrate other sectors with project-specific incorporated companies. P & ID is one of the companies from the stable of ICL Ltd. When the Federal Government professed priority in the development of the flaring gas, ICIL Ltd and surrogates were prepared. They were involved with General T.Y. Danjuma in previous projects before selling the idea of setting up a gas plant in Lagos under the code name Project Alpha under the auspices of P & ID.

There is no evidence that P & ID or its parent or sister companies spent their own money on Project Alpha, but P &ID used the profile of Project Alpha to hoodwink Nigeria into signing a Gas Supply and Processing Agreement for Accelerated Gas Development (the GSPA) under which Nigeria was to supply specified quantities of “wet” gas to Gas Processing Facilities (GPF) to be constructed by P &ID in Calabar to strip the wet gas into “lean” gas, to be delivered to Nigeria for power generation and sale either domestically or by export.

As serious as the import of this contract was to the economic security and financial well-being of the country, the contract gave P & ID unprecedented leverage and absolute discretion to determine when the contract would be repudiated by Nigeria. Leveraging this uncommon economic enslavement of Nigeria to P & ID by Nigerians, P & ID concluded and claimed that Nigeria had repudiated the contract by failing to supply the gas at a time when P & ID had not even secured the land to build the Gas Processing Facility and had no evidence of having any penny or capacity to build the Gas Processing Facility. It is because of that alleged breach that an Arbitration Panel in London awarded US$6 billion, which, by the interest tenor of the award, has now grown in excess of US $11billion.

From the findings in Judgment of the Honourable Mr Justice Robin Knowles CBE of the High Court of Justice, the Business and Property Courts of England & Wales King’s Bench Division, Commercial Court in case of the Federal Republic of Nigeria and Process & Industrial Developments Ltd delivered on 23/10/2023, the contract was induced and prepared under the influence of bribes given by P &ID. For cheap money, Nigeria was sold cheaply to P &ID.

His Lordship also found that the P & ID hacked into every aspect and stage of the dispute processing system and chain of the Nigerian Government and was able to have in real-time every document and correspondence concerning its claim made and/or communicated by or received by any or all the officers, lawyers, offices and channels involved in the dispute. Like a god, P & ID was reading the mind of Nigeria and ahead of Nigeria in the arbitral proceedings. With that leverage, it knew when to pounce and what to demand. Again, Nigerians were selling the country to P &ID for cheap by availing it of secret and classified documents and information.

Is this an isolated case? No! That is the story of how Nigerians underdeveloped Nigeria.

Sam Kargbo is a Senior Advocate of Nigeria and the Principal of Jackson, Kargbo & Associates, Abuja