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The need to revoke and properly privatise Edo Cement

Edo State Governor, Comrade Adams Oshi-omhole was last week quoted as saying the state government will revisit the privatisation of Edo Cement factory and would revoke the privatisation exercise if need be.

The privatisation of the cement factory by the Igbinedion administration in the state was not with good intention as the company has not worked one day after its privatisation.

The non-functioning of the factory has brought the economic life of the area to a stand still. Comrade Governor needs to look beyond those presently handling the company, BUA Cement, which competence to resuscitate the company is very much in doubt. Initially, it was Scancen that was the core investor in the privatisation of the cement company but lack of transparency, inadequate disclosure and series of other issues led to their departure.

In specific terms, the issue that has stalled the successful privatisation of the cement company and its eventual handing over to BUA is the mining lease over Obu marble deposit where the cement company was supposed to get the bulk of its raw materials.

The deposit has been a subject of litigation between Ado Ibrahim, the Ohinoyi of Igbirra land represented by his company, Ado Ibrahim & Co and the Okpella Community in Okpella. But several judgements in the past had denied that Ado Ibrahim & Co had any leases to the deposit under contest.

In one of such judgements in 1995, the Federal High Court in Suit No FHC/B/42/94, H.R.H. Alhaji A.Y.E. Dirisu & 3 ORS v. Ado Ibrahim Company Ltd, & 7 ORS, held in April 1995 that Ado Ibrahim &Co held no leases of any nature on any part of Okpella. The Attorney- General of the Federation and the Ministry of Mines were also defendants in the case.

But on the 16th of March 2005, one Engr. Chris Ushedo, Assistant Director (Mines) who said he was acting on behalf of the then Minister of Solid Minerals, Elder Odion Ugbesia, directed that the Obu quarry be divided into two equal halves between the people of Okpella and Ado Ibrahim and Co. Ushedo, in the letter Ref. No MSMD/MN/CO.0105/s.1/126, which was obtained from the ministry, gave as reason for the action, a purported earlier agreement between the two parties in a meeting with the minister.

But the action did not go down well with the Okpella people who have over the years spent a lot of money in litigations to ensure that they get full possession of Obu quarry, which they claimed, belonged to them.

The issue of the failed privatisation of Edo Cement Company is a pathetic one. In response to the stringent calls by the President across the globe for investors to come and invest in Nigeria, Scancem, a member of the Heidelberg Group had bought up the former Bendel Cement Company Okpella for $4 million (about N580 million).

The new company that sprang up from the ashes of Bendel Cement Company was Edo Cement Company with Scancem as core investor in 2002. In 2003, the foreign investors took control of the company, and had expended about N500 million in rehabilitating the company and paying the salaries of over 100 staff members.

Scancem did not know that danger was looming ahead. The lease for the main limestone deposit upon which the success of its venture lay was not issued by the Ministry of Solid Minerals despite the assurances by the Lucky Igbinedion government during negotiations for the purchase of the company that the lease was theirs for the asking.

Despite repeated pleas with the Federal Ministry of Solid Minerals by the Edo State Government, the Okpella people and other well meaning Nigerians, the ministry refused to sign the mining lease for Edo Cement Company, claiming that it is a subject of litigation between Ado Ibrahim & Co and the Okpella community.

Indeed, the Deputy Governor of the state then, Mike Oghiadomhe, had led a delegation including His Royal Majesty, the Okuokpellagbe of Okpella to the minister without making any impression on him on the need to issue the mining lease to the Edo Cement Company so that it can commence operations.

In a letter from Okpella Consortium, a consortium of legal practitioners, the Minister’s attention was drawn to the Federal High Court judgement of 1995, which established that Ado Ibrahim & Co had no leases on Obu quarry.

In one of the meetings by the contending parties with the Minister, Alhaji Ado Ibrahim had actually been asked to produce the lease which he purported to have and he could not. He, however, told the minister that he had gone on appeal on the 1995 High Court judgement that declared his leases non-existent and or null and void and illegal if existing.

And when the Minister asked the Ohinoyi why summons have not been served on the defendants about ten years after the Federal high Court judgement, he had no ready response. The Ohinoyi presented the same alibi when confronted on the issue. He said he would not grant an interview on the issue because it was in court. But when asked at what Court of Appeal he had the case, he gave the same excuse.

Such antics as this have made the Okpella community to believe that the Court of Appeal case, which Ado Abraham is peddling, may be non-existent. Barrister Ayuba Giwa, one of the counsels to the community said that he would be surprised if the case actually existed as none of the defendants has been served ten years after the Federal High Court case on which the appeal is based.

Indeed in 1995, when the Edo State Government wanted to privatise the cement company, Ado Ibrahim & Co had gone to court, instituting winding up petition against the company on the disputed mining lease. The petition was based on an alleged indebtedness of the company to Ado Ibrahim and Co, AICO, on the basis of the purported leases.

Edo Cement Company through the assistance of the Okpella community resisted this claim as dubious and the Federal High Court agreed with the defence. AICO went on an appeal and the Court of Appeal also dismissed it in Appeal no CA/B/150/96.

Also in Alh. Ado Ibrahim & Co Ltd. vs. Eldestein (Nig.) Ltd 2003, the Court of Appeal again dismissed AICO’s claim to mining rights in Okpella as bogus and false.

Also in suit no FHC/B/CS/12/2004, in a case between Cambut Ltd. vs. Alh. Ado Ibrahim & Co Ltd., the Federal High Court restrained AICO from claims over mining rights in Obu. Given this situation, officials of the Edo and Okpella people are irked that despite the seeming weakness in the case of the contestant, the lease has not been issued.

They even at the time challenged the minister to issue the lease so that whoever does not feel satisfied can go to court since there is already an existing court judgement upon which he can justify his action.

But all these pieces of advice seem not to appeal to the then minister which gave credibility to the assertion by some well meaning indigenes of Edo State that the issue of the lease for Edo Cement Company goes beyond who is right. There are strong feelings in the state that the Anenih/Igbinedion tussle for the control of the state had crept into the issue.

Elder Ugbesia, a former Personal Assistant to Chief Tony Anenih when he was Minister of Works, is an avowed Anenih loyalist and was alleged to be very strategic in this regard. As Minister of Solid Minerals, he was alleged to be in a position to make this calculation happen.

The Ministry of Solid Minerals officials disclosed that the rule in the ministry concerning the issuance of leases for mining activities is that once an application for a mining lease has been properly filed, the lease would be issued within two weeks. He indeed said that once such licence is not issued within the stipulated time, such applicants should approach the ministry with a proof of the application for relevant action.

While the politics around the privatisation of Edo Cement Company got complicated by the day, it was Scancem of Norway that felt the pinch with its investment of about N1 billion almost going down the drain and it had to find a willing buyer in BUA which has not been able to do anything with the company.

Yes, Edo State Government should revoke the privatisation and secure the mining lease from the Federal Government and resuscitate the factory to boost the state’s employment generation drive.


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