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Buhari Cancels Restoration of INTELS’ Pilotage Contract

Buhari Cancels Restoration of INTELS’ Pilotage Contract

•AGF, BPP back Bala-Usman

•President orders conclusion of procurement process within 60 days

Eromosele Abiodun

The battle by INTELS Nigeria Limited to retain its service boat contract in the pilotage district of Lagos, Warri, Bonny, Port-Harcourt and Calabar, which expired on August 8, 2020, has met a dead end with President Muhammadu Buhari’s cancellation of the January 2021 directive to restore the contract.

THISDAY reliably gathered that the president took the decision following advice from the Attorney General of the Federation (AGF) and Minister of Justice, Director General Bureau of Public Procurement (BPP), and Acting Director-General, Infrastructure Concession and Regulatory Commission (ICRC), that unanimously advised the president against the restoration of the contract.

The development was seen as major victory for the suspended Managing Director of the Nigerian Ports Authority (NPA), Hadiza Bala-Usman whose alleged sin was failing to honour a presidential directive on the said contract.

The Minister of Transportation, Rotimi Amaechi had listed failure to honour a presidential directive on the restoration of INTELS pilotage contract as terms of reference for the panel of enquiry set up to probe the NPA.

This was despite Bala-Usman’s explanation that the president had withdrawn the directive pending further advice from the Attorney- General of the Federation and the Bureau of Public Procurement(BPP).

The terms of reference read: “Examine and investigate issues leading to the termination of pilotage other contracts of NPA and confirm compliance with the terms of the respective contracts, court ruling and presidential directive.”

However, in a letter addressed to the AGF and the Minister of Transportation, with reference number: SH/COS/23/A/229, dated January 7, 2022, and singed by the Chief of Staff (COS) to the President, Prof. Ibrahim Gambari, seen by THISDAY, the president directed that the procurement process initiated by the procuring entity, NPA, that was submitted to the Federal Ministry of Transportation be forwarded immediately to the BPP for action.

The COS in the letter stated: “The president has also directed that upon receipt of the No-objection approval from the BPP, a memorandum be presented by the Ministry of Transportation to the Federal Executive Council for consideration, that the Ministry of Transportation should ensure that the process is concluded within 60 days of the president’s directive to avoid further loss of revenue by the federal government.

“That NPA should ensure that the sanctity of the agreements with respect to Onne 4 (Berths 9, 10 & 11) be maintained, as there is no subsisting contract with INTELS for their utilisation.”

Buhari also directed the AGF to ensure quick determination of the cases in court in view of their economic importance, stressing that the above set of directives prior approval dated January 22, 2021 granted on the matter.

THISDAY learnt that Buhari decided to act after reading the submissions of both the AGF and BPP who expressly warned of the danger of further litigations if the pilotage contract is restored.

The AGF had two months ago written to the president after a review of submissions by the NPA and INTELS.

In the letter dated November 18, 2021, with reference MJ/DSD/23/VII, seen by THISDAY, the AGF had stated that the NPA neither suspended nor terminated any of its contracts with INTELS, “which therefore obviates the need for any restoration.

According to him, “There is certainty in the duration of the contract and the position of the law remains clear that a written contract freely entered into by the parties is binding on them. “Accordingly, the contract for Managing Agent awarded to Messrs INTELS in 2007 validly came to an end and extinguished pursuant to the terms of agreement between the parties, which specified an end date of August 2020. The agreement did not provide for any further extension of the contract in favour of INTELS.

“It is also to be noted that NPA pursuant to the expiration of the contract, kick-started the procurement process to appoint another managing agent in order to forestall any break in the service being rendered.

“NPA submitted that it concluded the tender/bidding process and forwarded the result to the Minister of Transportation for same to be presented for FEC’s approval.”

INTELS, the AGF added, resorted to litigation to frustrate the conclusion of the procurement process based on its grievance on a different subject-matter.

The development, the AGF added, had created a vacuum in the provision of this critical service in the maritime sector with its attendant loss of revenue from service boat operation to the federal government.

The AGF also stressed that the approval granted by the president in January last year, which Bala-Usman was said to have disobeyed, was based on insufficient information at the time.

The purported termination, he concluded, could not have occurred since the contract came to an end in 2020 based on the agreement by the parties.

In the same vein, the BPP denounced claims by the Ministry of Transportation and urged the president not to restore the contract to avoid further litigation.

The BPP in a letter addressed to the COS to the president, with reference, BPP/DG/2021/007, dated March 9, 2021, had stated that the decision by the NPA to initiate a procurement process in anticipation of the expiration of the contract for boat operation managing agent was in order.

The BPP in the letter signed by its Director General, Mamman Ahmadu, concluded that, “There is a compelling need to ensure that contractors and service providers do not take undue advantage of government agencies and do not obtain contracts from government agencies through the court rooms.

“The correct procedure is that contracts should be won through a proper procurement process that complies with the provisions of the PPA, 2007. Furthermore, there is need to avoid the kind of monopoly currently enjoyed by Messrs INTELS which has cascaded into entitlement mentality being demonstrated by the firm.

“Also, monopoly will inevitably result in charging a higher price to the consumer/client than what is obtainable from a competitive market, thereby eroding value for money.”

The NPA and INTELS have since 2020 disagreed over the renewal of the pilotage or boat service contract.

The Nigerian Ports Authority insisted that the 10 years contract with INTELS expired on August 8, 2020, after which it initiated procurement processes for the contract.

The NPA thereafter submitted the outcome of the procurement process, which the Authority says INTELS participated in, to the Minister who, rather than forward same to BPP, sought the approval of the President to restore the contract to INTELS. This situation has brought the boat pilotage service operations to a standstill for about 16 months, with attendant revenue losses to the nation.

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