Again NPA revokes Intels contract over mutual debt outstanding

There are indications of post election war between the Nigerian Ports Authority (NPA) and Intels Nigeria Limited (Intels), as the former has reportedly terminated Intels’ pilotage contract with it over alleged failure of Intel’s to remit $145.84m.

Reacting, Intels accused NPA of playing the political herring, and explained that the said debt settlement is a mutual one, predicated on NPA paying contract fee debt of $19.67 million been part of the agreement reached under terms of reciprocity. Interestingly, NPA has faulted Intels defence saying the concept of reciprocity is alien to their agreement.

The resumed hostility may not be unconnected with the recent indictment of NPA by the House of Representatives for withholding $21.3 million and €6,626,429.59 from the Treasury Single Account (TSA) of the federal government. NPA through its Managing Director, Ms. Hadiza Bala Usman had explained that the monies in question were the outcome of third party actions not directly committed by the authority.

Usman further explained that Intels was one of those giving it bad names, having reneged on a mutual agreement to respect the STA policy. Reports indicate that altogether over $995.71 million have been lodged outside the TSA by some MDAs, including the Nigerian National Petroleum Corporation (NNPC), the Nigeria Customs Service (NCS), the Federal Ministry of Environment among others; NPA has descended on Intels with an unusual ferocity, by revoking its pilotage contract, while others believed to have raised the House Committee’s eyebrow on NPA’s financial report are carrying on as though the authority does not exist.

It will be recalled that the NPA boss had ahead of the 2019 election taken on Intels in the most horrendous attacks and series of clampdown, allegedly under the guise of supervision and control, and under tales of contractual violations.

In her defence at the House Adhoc committee recent probe, the NPA boss explained that some of its funds not accounted for the TSA were funds currently at large. She accused Heritage Bank and First City Monument Bank of some of the culprits in the financial industry. In particular, she accused Heritage bank of failure to remit the judgment money under its custody to it (NPA), despite the intervention of the Central Bank of Nigeria (CBN). She also accused First City Monument Bank for withholding the sum of 6.62 million euros from its Cargo Tracking Services operations kept with the bank, and believed to have been seized by the Economic and Financial Crimes Commission (EFCC).

Usman also expressed disappointment at the manner “the EFCC suddenly moved the 6m euros from FCMB to their own account; they just unilaterally swept the money”, nevertheless also fingered its old foe Intels in the STA mess being investigated by House Committee chaired by a member of the All Progressives Congress from Kano State, Mr Danburam Abubakar-Nuhu; she has since not made known efforts by her office to get defaulters to clean up the debt cobebs.

Instructively, she found it very convenient to descend on Intels. Although she said NPA and Intels had resolved their differences after the former agreed to comply with the TSA policy, she disclosed that Intels had not remitted outstanding revenue of over $130 million, which it collected for 10 months prior to November 1 last year, where they both purportedly settled their differences.

The latest termination of Intels contract by the NPA is coming on the heels of over two years of bickering; effectively putting the leading integrated logistics and facilities services provider under needless hostile investment posturing and political philandering.

According to her, Intels effective from November 1, 2018 has started remitting all revenues it collected on behalf of the NPA into the TSA, apart from outstanding revenue of over $130 million, billed to be collected for 10 months prior to November 1. She further explained that the decision to revoke the contract was taken in line with Article 8 (C) of its agreement with Intels, dated February 11, 2011.

Part of the letter of advice signed by the authority’s Assistant General Manager, Legal Services, reads “We refer to the agreement dated 11th February, 2011 and 24th August, 2018 between the NPA and Intels Nigeria Limited for the monitoring and supervision of oil industry related activities in the compulsory pilotage districts of the authority (service boat operator).

“The NPA (the principal ) hereby serves on you Intels Nigeria Limited, (the Managing agent) notice of termination in line with article 8 (C) of its agreement with Intels, dated 11th February, 2011, which said notice shall expire three months from the date of this notice of termination.”

NPA has however sought to take shelter against fulfilling its part of the contract fee obligation, by running a ring of judicial and political crevices around an otherwise clear and unambiguous   contractual understanding.

One such defences relied upon by the NPA is the advice by its Executive Director, Finance and Administration, Mohammed Bello-Koko to the Managing Director, in which he accused Intels of non-compliance with the presidential directive and circular on implementation of Treasury Single Account (TSA) and Article 4.1 of the executed supplemental agreement. Bello-Koko said in his letter: “Let it be clearly stated that Intels persistent refusal to remit all service boats revenue to TSA as clearly stated in Article 4.1 of the supplemental agreement and the sudden introduction of the ‘concept of reciprocity’ in your letter dated March 6, 2019 is worrisome. The concept of reciprocity is alien to the executed supplemental agreement.”

He further argued that based on Article 4.1 of the executed supplemental agreement, “The total revenue generated on behalf of the principal in each of the pilotage districts from the service boat operations shall be paid directly into the principal’s TSA at designated commercial banks which will be swept daily into the principal’s corresponding TSA at the Central Bank of Nigeria (CBN).”

The NPA said $145, 849,309.33 is the sum total outstanding in the service boat revenue generated from November 1, 2017 to October 31, 2018.

However in its response Intels in a letter it addressed to NPA dated March 6, 2019, accused the authority of peddling falsehood and half truths regarding the debt sum. The maritime logistics service giant drew NPA attention to the fact that NPA erred in calculating the outstanding revenue as $145. 84 million, which covers the period of November 1, 2017 to October 31, 2018, saying the figure was not correct, and insisted that its pledge to pay the sum of $55.70 million as revenue for period from November 1, 2017 to March 31, 2019 is predicated on NPA’s payment of $19.67 million fee, that has been outstanding without regards to ethical behaviour.