By Clara Nwachukwu

As the Special Fraud Unit, SFU of the Nigeria Police at Ikoyi, Lagos, opens investigation into a N832million facility owed the United Bank for Africa, UBA Plc by Menol Oil and Gas Limited, available statistics showed that the company consistently fell short on the delivery of products allocations approved for it in 2011.

The Petroleum Products Pricing Regulatory Agency, PPPRA, the managers of the Petroleum Support Fund, PSF, reimbursed marketers and oil traders for the difference between the landing costs of petrol and kerosene and the local pump prices for products under the subsidy regime.

On quarterly basis, marketers and oil traders are given approval to import specific volumes of refined petroleum products based on their capacities and quotations. However, Vanguard investigations revealed that from the first to the third quarters of 2011, Menol Oil hardly met its approved allocations before the exercise was streamed in the last quarter.

For instance, of the 30,000 metric tonnes, MT,of petrol approved for the company in Q1 of 2011, it brought in 28,060.675MT, leaving a shortfall of about 2,000MT.

The company also fell short marginally of approved allocations in Q2, as of the 15,000MT approved, it brought in 14,678.361MT, leaving a balance of over 321MT.

Menol could barely meet half of its Q3 obligations in which it supplied only 13,330.81MT out of the approved 30,000MT, leaving a whopping balance of almost 17MT.

Presidency sources told Vanguard that the company’s record of poor performance, led to its removal from products import list, more so, in view of the fact that the company has no depot or storage facility as required of the subsidy regime.

Furthermore, Menol Oil is also one of the oil marketing companies recently published by the Ministry of Finance as being guilty of subsidy payment infractions. The Aigboje Aig-Imoukhude-led subsidy committee declared that about N1.7billion was paid to the company as “subsidy payments for which mother vessels were not found in locations claimed at the time of transshipment.”

UBA invites Police

UBA recently invited the SFU Ikoyi, to help it recover the sum of N832million, which it alleged was fraudulently diverted by Menol Oil.

The bank claimed it extended “a facility for the sum of N1b was granted to Ngozi Ofodum of Menol Oil & Gas Ltd in June 2011, to finance the importation of 7,000MT of PMS for supply to acceptable off-takers.”

UBA’s invitation of the Police to go after one of its customers brings a new twist to the current imbroglio that has engulfed the subsidy regime in which with the involvement of banks in the scam has remained largely shielded from the public.

The basis of the bank’s petition is based on the fact that most of the documents presented for the facility were forged. Consequently, the SFU declared five persons, Messrs Ngozi Ofodum; CynthiaGboneme; Frank Gboneme; Ikechukwu Gboneme; aand Ladi Utieyione, as suspects in the case.

A press bulletin issued by W/ASP Ngozi Isintume, on behalf of the Commissioner of Police, SFU, read in part:  “The Special Fraud Unit (SFU) is investigating a scam by Oil Subsidy racketeers involving 7,000MT of PMS valued at N832m fraudulently diverted with forged documents submitted to Petroleum Products Pricing Regulatory Agency (PPPRA) Abuja, for subsidy payment.”

Banks hide information

In view of the involvement of the SFU, parties mentioned in the petition, including the bank, were not willing to speak further on the case. But analysts maintained that the banks, who issued the Letters of Credit, LCs, for the fuel imports are hiding a lot of information on the subsidy transactions that can assist the Federal Government in nailing the scammers if they wanted to.

Some of them told Vanguard in confidence that upon the opening of legislative and executive probes into the subsidy regime, many banks offered to pay off some marketers in an attempt to cover up their involvements. They argued that the banks were merely keeping quiet to protect their corporate images.