INTELS still owes FG $207m, Hadiza Usman memoir alleges
Hadiza Bala Usman, a former managing director of Nigeria Ports Authority (NPA), has alleged that Integrated Logistics Services (INTELS) was still indebted to the Federal Government to the tune of $207 million at the time she was suspended.
Usman disclosed this in her memoir in which she argued that she was wrongly accused and suspended from office by Rotimi Amaechi, a former minister of transportation.
Speaking in the memoir tagged, ‘Stepping On Toes; My Odyssey at the NPA,’ Usman alleged that Amaechi wanted her out of office at all costs because she was “unyielding to his request to back down on matters that were not in Nigeria’s interest.”
She said despite her effort, INTELs’ remittances to the Treasury Single Account (TSA) were infrequent as the company remained largely unaccountable.
She stated that as of the time she left office in May 2021, the last remittance into the TSA account was $30,233,769.85 made on January 2020, for revenue collected from International Oil Companies (IOCs) under INTELS’s agency for the period between April 1, 2018 and July 31, 2018, but added that as of May 2021, the sum of $207,646,757.26 already reconciled as payment for the period between April 1, 2018 and September 30, 2019 remained unremitted.
“For instance, while the total revenue reconciled by the joint committee for the period between November 1, 2017 and March 31, 2018 was $77,973,005.49, only $22,270,774.32 was remitted to the service boats dedicated to TSA, the company retained the balance of $55,702,231.17,” she said.
She further said that the situation remained a battle of wits until March 29, 2019, when the NPA issued INTELS a three-month notice of termination of the agency in line with Article 8 (C) of its agreement with the company, pointing out that a few weeks earlier, the authority had once again, written to demand full remittance.
She said that in a letter, dated March 1, 2019, NPA expressed concern over the company’s failure to pay all the revenue received on behalf of the Authority into the TSA.
“It highlighted that the supplemental agreement stipulates that the full receipts should go into the account after which reconciliation is carried and INTELS get paid. It was, however, unacceptable that an average of 80 percent of revenue was withheld by INTELS while a meagre 20 percent was paid to TSA. The authority then gave INTELS five days’ grace within which to remit the outstanding revenue. More than 20 days later, the company failed to respond to the request, and the authority was constrained to invoke the relevant provisions of the agreement for termination of the relationship.
“I should state here, however, that INTELS had occasionally attributed its refusal and failure to remit these funds to the NPA’s indebtedness to it from another project, the construction of what was termed Onne 4B. This contract was signed with Deep Offshore Limited, a subsidiary of INTELS in 2013 for the sum of $2.79 billion in 2013. It was for the provision of additional berths, dredging, reclamations, shore protection and road networks at the Onne Port within a period of six years and a concession of 25 years of the completed works to INTELS,” she said.
Usman further pointed out that by the agreement, INTELS was expected to fund the contract, while the expenditure would be amortized from revenue raised through service boat operations.
“My first impression of this project was that Nigeria had been terribly short-changed. Even though I was relatively new to the maritime sector, I had an idea of what project management involved and I could not imagine how a country would spend $2.79 billion when it was not building an entirely new port. Berths 12-19, which were to be constructed were for instance, in an area of not more than 200 meters. I asked questions about the Singaporean Ports and other ports that were built at the same time and concluded that Nigeria did not get value for money on this deal.
“However, it was already a done deal and there was nothing anyone could do about it. The company obtained bank loans to execute the project and the NPA was bearing the burden for the cost of funds. We felt this was unfair. This was a contract for which the government would not just pay but had also offered INTELS a 25-year concession; thus, liability for the cost of funds should not be the responsibility of the government,” she said.
She stated that each time the authority invoked its rights to revoke the boat pilotage agency with INTELS, the company referred to the contract for the construction of Onne 4B as a reason it must retain the agency, maintaining that the authority always argued that they were two different contracts, which happened to have been awarded to companies within the same group.
The former NPA boss said things were further complicated by the legal action and the refusal of Amaechi, to act on the request from the NPA, stressing that at the time INTELS instituted the case, unremitted funds from reconciliations between April 1, 2018 and September 30, 2019 in their custody stood at $207,646,757.26
“On June 18, 2020, I wrote a letter entitled: ‘Letter of complaint on unremitted government service boat pilotage operations revenue in Messrs Integrated Logistics Services Nigeria Limited’s custody,’ to Abdulrasheed Bawa, the chairman of the Economic and Financial Crimes Commission (EFCC), complaining about the refusal of INTELS to remit these funds, the authority sought the intervention of the commission in the recovery of the total indebtedness of INTELS to the government,” she said.
“I became managing director of the NPA in 2016 when the latest contract was just halfway into its new tenure. Like all other third-party contracts, I studied the service boats’ contracts and discovered several irregularities. The first irregularity I noticed was that the managing agent’s commission was 28 percent. We thought this was unusual and upon investigations, discovered that the commission was 10 percent when the agreement started in 1997. It, however, gradually increased and peaked at 28 per cent at the time of the 2011 agreement,” Bala Usman added.