News - Oil & Gas - February 11, 2022

Toxic fuel import saga: Oando, MRS consortium clarify on their roles

Name a member of the Consortium - Brittania-U of being solely liable

MEDIATRACNET

The consortium of petroleum products marketing companies named in connection with the toxic fuel importation saga has provided clarifications on their roles.

On Thursday, the Group Managing Director of the Nigerian National Petroleum Corporation, Mele Kyari, identified the four companies involved in the importation of the premium motor spirit (PMS), popularly called petrol, that was later found to have been laden with an over-dose of methanol.

Kyari said at the end of a meeting with representatives of some of the oil marketing firms that the fuel cargoes shipped to Nigeria from Antwerp, Belgium were by four of NNPC’s direct-sale direct-purchase (DSDP) suppliers.

The four fuel suppliers include
MRS, which imported the consignment in MT Bow Pioneer; Emadeb/Hyde/AY Maikifi/Brittania-U Consortium in MT Tom Hilde; Oando in MT Elka Apollon, and Duke Oil in MT Nord Gainer. All the four consignments, Kyari said, originated from the LITASCO port Terminal in Antwerp-Belgium.

Kyari did not accuse any of the companies of acts of negligence or sabotage, as both the cargoes quality certificates issued at loading port (Antwerp-Belgium) by AmSpec Belgium and quality inspectors appointed by the Nigerian Midstream-Downstream Regulatory Authority (NMDRA) confirmed the products met Nigerian the fuel specifications.

However, he said the NNPC was working with the NMDRA to take necessary actions in line with subsisting regulations, suggesting sanctions against the importing companies for some breaches.

But rising to the defense of their roles, Oando Plc and Emadeb/Hyde/ Ay maikifi Consortium have strongly denied insinuations about any complicity in the entire saga.

“Following media reports listing Oando as one of four importers that supplied methanol-blended Premium Motor Spirits (PMS) into the country, we hereby state that Oando did not import and supply PMS that was adulterated or substandard,” Oando said in a statement.

“The PMS supplied by Oando met Nigeria’s fuel import specifications. We are committed to working assiduously with the NNPC and industry to identify the root cause(s) of the subsequent contamination of the PMS supplied.

“We want to assure the public that Oando as a responsible corporate citizen would not partake in the importation, distribution, or marketing of substandard petroleum products,” the company added.

On its part, Emadeb/Hyde/ AY Maikifi Consortium also denied any complicity, although its accused a member of the consortium, Brittania – U, which it alleged, decided to go solo in the arrangement as the culprit behind the imported bad fuel.

The consortium, Emadeb/Hyde Aymaikifi in a press statement on Thursday referred to the press release of February 9, 2022 by the NNPC on the issue of contaminated PMS with higher concentration of methanol allegedly imported by Emadeb/Hyde/Ay Maikifi/Brittania-U Consortium.

“We hereby state that the said importation of the contaminated PMS was executed by a member of the consortium, to wit: Brittania-U. Therefore, the blanket claims made against the consortium by the NNPC are misleading and contradicts the actual events that happened; they do not fully reflect and/or represent what transpired,” the consortium clarified.

“It is important to inform the public of these facts and provide clarifications relating to the delivery of the said contaminated PMS to the country. We also deem it necessary to protect our image as we have invested a lot in building our respective brands in the industry,” the consortium added.

Facts and findings
In presenting what he called “Facts and Findings”, the consortium said Brittania-U NigeriaLimited (Brittania-U) was the sole supplier of the 90,000MT of PMS delivered via MT Torm Hilde with laycan January 2-4, 2022.

At the formation of the Consortium in May 2021 by NNPC, Brittania-U refused to execute the Service and Consortium Agreement submitted to NNPC in fulfilment of the award of the DSDP Contract.

The consortium said Brittania-U had insisted on dealing with NNPC independently despite several efforts by Emadeb, the lead of the Consortium, to engage the company to join in working as a team to execute their DSDP supply contract.

The NNPC, the consortium pointed out, was expressly notified about by other members about the conduct of Brittania-U via a letter dated June 2, 2021.

“Further, Brittania-U vehement refusal to execute the Consortium Agreement with the other Consortium members – EMADEB/HYDE/AY MAIKIFI – was surprising and frustrating to everyone.

“Brittania-U communicated all her actions to the other Consortium members and NNPC harping on its preference to perform a sole contract for Crude lifting and PMS supply under the DSDP arrangement.

“Brittania-U’s choice to be solely liable under her supplies to NNPC and in the light of which she indemnified the other Consortium members accordingly.

The consortium said the non-acceptance of the nominated international partner agreed by other Consortium members–EMADEB/HYDE/AYMAIKIFI, and Brittania-U’s unwillingness to co-operate or share information and documents with the other Consortium members in respect of the December 2021 crude cargo allocated to her by NNPC.”

“Following the repeated refusal of Brittania-U to work with the Consortium, Brittania U indemnified the other consortium members – Emadeb/Hyde/Ay Maikifi’’and the resulting agreement was executed by their company on June 16, 2021.

The agreement reads in part: “The Indemnity clause contained in the aforementioned agreement covers Emadeb/Hyde/Ay Maikifi’’ against all damages, losses, costs, expenses (including reasonable legal costs, expenses and attorneys’ fees) and liabilities incident to claims, demands or causes of action brought by or on behalf of any person or entity, which claims, demands or causes of action arising out of, are incident to or result from the performance of or failure to perform the Project.

“The indemnity also covers Shortages in delivery of products, late deliveries, delivery of off-spec cargo or other wrongful performance of their obligations in the DSDP agreement.”

In a letter dated December 10, 2021, EMADEB/HYDE/AYMAIKIFI informed NNPC of non-receipt of information from Brittania-U on all correspondences relating to the DSDP crude cargo allocated to them, adding that Brittania U’s action contradicts all efforts to ensure performance on her allotted crude cargo.

The consortium said following the notice of the contaminated product, Emadeb/Hyde /AY MAIKIFI immediately notified Brittania-U via a letter dated February 3, 2022, and also expressly informed NNPC of the sole liability of Brittania-U.

Based on the substantial evidence provided to NNPC and several declarations by Brittania-U to NNPC, the Consortium saidbBrittania-U should be held solely liable for the supply of the PMS via MT Torm Hilde.

“This is also demonstrated by their unwillingness to be part of the consortium; however, all the other parties were duly indemnified by Brittania-U. The other Consortium members -Emadeb/Hyde /AY MAIKIFI had performed and delivered 270,000MT of PMS in the last five months and they were certified by the NNPC-nominated inspector without any complaint or adverse issues.’Out of the 270,000MT of PMS,90,000MT is currently discharging via MT Fair Seas offshore Lagos.”

The consortium added: “All records showing our performance are available with the NNPC for verification and validation.

It assured that Emadeb/Hyde/AY MAIKIFI would continue to work with NNPC by performing creditably on all their obligations.

“As reputable companies, we will not associate ourselves with any activity that will be to the detriment of the citizens of the country.

Brittania-U did respond to calls and text messages sent to it seeking their reaction to this report as at the time of going to press.

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