Obasanjo Ordered Sale Of AP Shares To Zenon Oil – BPE

Bureau of Public Enterprises (BPE) on Tuesday said former President Olusegun Obasanjo gave the approval for the divestiture of the African Petroleum Plc (AP) shares to Zenon Oil Limited.

Ibrahim Babagana, who represented the BPE’s Director General, Irene Chigbue, at the two-day public hearing organised by the House of Representatives Committee on Privatization and Commercialization on the controversial sale of the shares to Zenon Oil, also dissociated the Bureau from the transaction.

But Babagana’s submission did not impress members of the committee, who summoned Chigbue to appear before them today to explain the Bureau’s actual role.

The committee members also summoned the Director General of the Nigeria Stock Exchange (NSE), Ndi Okereke-Onyuike, and the chief executive officer of AP Plc to appear today.

Group Managing Director of the Nigeria National Petroleum Corporation (NNPC), Abdullahi Yar’Adua, who wrote in to excuse himself from the hearing on Tuesday is also expected to testify today.

In his submission, Babagana said, “The BPE was not involved in the equity swap conversion or the final divestiture to Zeno Petroleum Limited, even though it was aware that the approval had been granted by the former President.”

He stated that, at its meeting of October 2000, the National Council on Privatisation (NCP) approved the sale of 30 per cent of the Federal Government of Nigeria shares in AP and the share purchase agreement was signed on the 17th of November 2000.

Babagana added that after Sadiq Petroleum had successfully taken over as the core investor, it uncovered a debt of about N40 billion in the former management of the company prior to its privatisation.

“Subsequently, the NNPC based on the approval of the FGN transferred the shares to the NNPC pension fund.

It was the NNPC pension fund that disposed the shares of AP Plc through the Nigeria Stock Exchange (NSE) to Zenon Petroleum Ltd. The shares were crossed at the floor of the NSE in May 2007,” he stated.

Earlier in his testimony, Chairman of Sadiq Petroleum, Peter Okocha told the committee that the firm was announced winner of the government’s 30 per cent ownership in AP but that the euphoria of the victory was short-lived “as no sooner had we settled down to business of the day did we discover the repulsive and shocking realities of AP Plc was.”

“Alas” he added, “the debt over hang of AP Plc as we were made to believe was not N6 billion but a whopping N26.5 billion, a debt not considered before sales.”

Okocha also disclosed that following the discovery of the debt, BPE convened several meetings without result and that the Bureau could only write Pipeline Product Marketing Company (PPMC) for a temporary reprieve from 31st August to 1st April 2001 instead of outright cancellation with the hope that the issue may be resolved then, but it never did.

 

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