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30 June 2017

Awuah Darko sold ‘dirty fuel’ too – Majority

 

The Majority in Parliament has waded into the BOST scandal which has generated intense public interest and has accused the Minority of playing mischief with the case.

This comes on the heels of accusations against Managing Director Alfred Obeng Boateng that he superintended the sale of 5 million litres of contaminated fuel to Movenpinaa, who in turn sold it to Zup Oil despite the fact that the product did not meet industry standards.

The Minority and some CSOs have since demanded the dismissal of the BOST MD.

But addressing the media in Accra on Friday, 30 June 2017, acting Chairman of the Mines and Energy Committee of Parliament, Mr Emmanuel Gyamfi called on government to institute a probe into the activities of BOST since 2009.

Below is the majority’s full statement:

RE: MINORITY CALLS FOR FULL SCALE INVESTIGATION INTO BLATANT CORRUPTION AT BOST – PRESS STATEMENT BY MAJORITY CAUCUS ON FRIDAY JUNE 30, 2017

The events playing out at BOST requires engagement and interrogation. Five million litres of fuel has turned out to be contaminated.

The Minority has alleged that “MOVENPIINA bought the product at GHS1.00 and sold at GHS1.30 to ZUPP Oil at a 30% higher cost”. That is a falsehood. MOVENPINAA indeed bought the contaminated product at GHS1.30 and then sold to ZUPP Oil at a price of GHS1.32 and thus made a marginal profit of GH¢100,000.

Between 2014 and 2016 when the contamination of fuel products escalated, the average price that the product sold for was GH¢0.70 (70 pesewas) per litre, as the price ranged from GH¢0.50 to GH¢0.90. The sale price of the recent contaminated product at GH¢1.30 which is 86% higher than what obtained in the past is the highest value the nation has ever earned. Another untruth from people who have sworn to distance themselves from the truth and who think that by yelling “Wolf, Wolf” they would court public sympathy and avoid any inquisition into their own past deeds.

An erroneous impression is being created about the total proceeds from the sale of the contaminated product. BOST sells its good-spec at a price of GHS1.75 per litre; the off-spec in question sold at GHS1.30 per litre. The 5 million litres contaminated product would have ordinarily sold at GHS8,750,000.00.

In the face of the contamination, the sale of the product at GHS1.30 per litre yielded GHS6,500,000.00 which represents a shortfall of GHS2,250,000.00 and not the conjured figure of GHS14.25 million.


The Minority has stated that at the time MOVENPINAA was chosen to purchase the contaminated price on May 19, 2017 the company had not been registered as a limited liability company. They further alleged that the company only got to be registered on May 29, 2017, ten (10) days after the offer to same company to buy the 5 million litres and added that the company had no licence from NPA to engage in that business. These allegations must be investigated. One would want to believe though that Dr Kwabena Donkor and Armah Kofi Buah are aware that the Companies Act under Section 13 allows for a contract or any transaction entered into by a company prior to its formation or by a person on behalf of the company prior to its formation.

The NDC has alleged in their press statement that “under no circumstance should BOST experience such high level of contamination as we are witnessing”. The truth of the matter, without justifying the recent event though, is that in 2014 under the NDC a similar contamination occurred, the quantity involved was 4.6million litres; in 2015, still under NDC, another contamination occurred, the quantity involved was 9.9million litres; 2016 witnessed the mother of all contaminations, the quantity involved amounted to 12million litres. Clearly, therefore, the statement by the Minority led by Hon. Armah Kofi Buah and Dr. Kwabena Donkor is a palpable falsehood.

Again, another mischief which the Minority sought to pollute the public with is that the contamination had to do with the inefficiencies and negligence of Mr. Alfred Obeng. As has emerged now, the 5million litres contaminated was detected on January 18, 2017, exactly 11 days after the swearing in of President Nana Addo Dankwa Akufo Addo. Alfred Obeng Boateng had not at that time assumed office to take over, and Mr Awuah Darko was still, effectively, the CEO.

BOST management investigation established that, that occurrence was attributed to human error. The four staff who were in charge of operations at the time were interdicted, before Alfred Obeng was posted there.

ACEP which has waded into the controversy and has made a categorical statement which is very informative. For instance, ACEP insists that BOST has never sold any contaminated oil to any private company before, that is, on account of what information exists on their books. However, several unimpeachable sources counter that claim and posit that in the past, private intermediaries have purchased the contaminated products. If that is the case how come the evidence is not reflected in the books of BOST, as ACEP is stating?

What is assuring though, in the face of the confusion in the air is the assurance by both BOST and NPA as well as National Security and the Consumer Protection Representative and the media persons who went on that inspection, that what ACEP alleged and which allegation the Minority in Parliament led by Dr. Kwabena Donkor and Armah Kofi Buah, both former Energy Ministers in the immediate past NDC administration, cannot be true. They only sought to cause fear and panic in brazenly stating that neither MOVENPINAA nor ZUPP Oil which procured and acquired the contaminated oil have the capacity to store the tonnage of fuel in question and therefore they have conspired to sell the contaminated product to some oil companies who are vending to the general public.

The Minority further stated that the norm and practice in the event of such contamination is for BOST to arrange with TOR for the treatment of the product through blending, and that it was wrongful for BOST to have sold the product. That statement, again, is uninformed. There are indeed three (3) options available in such events.

First, without doubt, is that the product could be blended or refined at Tema Oil Refinery (TOR). TOR at the moment is non-operational. In other words, this option is not available, the NDC MPs know that and yet, to confuse the general public, that option is what they stressed.

Second option is what is termed Gradual Injection. A little over700 million litres (about 20 ship loads) is what would be required to undertake the exercise to completely neutralise the effect. That would take over one-and-a-half years to accomplish and the loss to BOST would be equivalent to about US$3 million for merely holding the stock over that period of time.

The third option which BOST applied itself to is the sale of the contaminated product as an “Off-Specification” (Off-Spec). That was the option that BOST availed itself to.

Notwithstanding, since the events of contamination appear to be playing out every year, and they are all due to ‘human error’, we agree that a full scale investigation should be launched to fish out the culprits and, if any acts of deliberation is found, sanctions shall have to be applied.

 







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