Managing Director and Chief Executive Officer of Access Bank Plc, Mr. Aigboje Aig-Imoukhede
By Ejiofor Alike
Oil Marketing and Trading (OM and T) companies have faulted the various subsidy probe committees for relying on data obtained from LIoyds List Intelligence to declare vessels non-operational.
The marketers, some of whom are under investigation for alleged subsidy fraud, also noted that it was foreign oil traders that made the choice of vessels used to import refined petroleum products into the country and not the marketers.
The two committees set up by the Federal Government to probe subsidy, which were both headed by the Managing Director and Chief Executive Officer of Access Bank Plc, Mr. Aigboje Aig-Imoukhede had recommended that subsidy paid on products brought into the country by vessels that could not be located on the Lloyds List Intelligence should be refunded by the marketers.
The Aig-Imoukhede committee had noted on one of the reports that “this implies that the subsidy on this transaction must have been wrongly paid since MT Zhen which was supposedly used could neither be located on the Lloyds List Intelligence nor anywhere on the West African Coast.”
One of the probe panels also wrote in its report that “MT Alpine Magnolia, the mother vessel was not listed in the Lloyd’s AIS Nigeria 2010 List, Lloyd’s Agency Nigeria 2010 List so it may not have been offshore Lagos as noted in the PPPRA List.”
However, one of the marketers told THISDAY during the weekend that vessels are not statutorily required to be registered with LIoyds before going into operation.
He stated that of over 75,000 vessels that ship products worldwide, only 12,000 vessels were registered with the Lloyds List Intelligence and could be tracked.
A shipping expert, who also corroborated the position of the marketer, told THISDAY that there were other members of the International Association of Classification, apart from LIoyds.
The expert listed Bureau Veritas, American Bureau of Shipping, NKK of Japan, Russian Register and German LIoyds, as some other organisations to which vessel owners can subscribe.
In the course of their investigations, the probe panels also relied on data obtained from LIoyds List Intelligence to establish cases of round tripping and diversion of products.
“The fact that a vessel cannot be located on the LIoyds List Intelligence does not mean that the vessel does not exist. There is no rule anywhere that says that a vessel owner must subscribe to LIoyds; LIoyds is not a regulatory organisation or a government body but a commercial organisation that delivers services to people, who subscribe to it,” said the expert.
An independent importer of petroleum products also told THISDAY that the “whole noise about LIoyds is nonsensical because the banks have better information that could help investigators than LIoyds,” adding that the organisation can only track movement of vessels but has no knowledge of the content.
“LIoyds does not confirm the content of a vessel; it does not measure the quantity of products inside a vessel because it has no access to the vessel. It can only rely on what the importer has declared and track the movement of the ship from one point to the other,” he said.
He further stated that the banks that fund importation have access to better information that could help subsidy probe panels.
“Every genuine transaction is funded by the banks and once a bank opens a Letter of Credit (LC), it does not lose sight of the movement of the vessel until it discharges its products. This is to ensure that the bank is in control of its money. In the shipping document, the bank is recognised as the Shipper, while the marketer is the Notify Party.
So, the bank has control of its money and the movement of the vessel and can divert the ship to anywhere to recover its money,” he said.
The importer also stated that the choice of vessels that brought in petroleum products into the country was made by foreign traders that supply the products and not the Nigerian marketers.
“The foreign oil traders, who buy the products and supply to the Nigerian marketers decide the vessels with which it ship the products to Nigeria,” he said.
The subsidy probe committees had noted in their reports that subsidy payments were made on imported products for which mother vessels were no longer operational at the time of transhipment.
The alleged use of decommissioned ships was one of the 17 infractions recorded against the marketers by the technical committee, to which the country lost N422, 542,937,668.59.