Hemorrhaging BOST

Abubakari Seidu Ajarfor examines how within the space of one Managing Director leaving and another taking over, massive rot has been uncovered at the Bulk Oil Storage and Transportation (BOST) which consequently led to severe bleeding of the state of millions of dollars.

Six months after Mr. Kwame Awuah-Darko, a past Managing Director of BOST was replaced by his successor, Mr. Alfred Obeng Boateng, the latter has been accused of dubious deals including financial malfeasance and lack of competence in failing to ensure that due diligence was carried out with regards to numerous contracts awarded to various companies.

Meanwhile, by our analysis, counter allegations by the current administration seems to suggest that over US$100 million of the tax payers money was embezzled through dubious deals and financial misappropriation by the Kwame Awuah-Darko-led administration.

But after issuing a statement calling for the interdiction of Mr. Awuah-Darko and some other senior staff, the Alfred Obeng-led administration which was only six months old in office, was itself heavily indicted back for bleeding the state in the infamous dirty fuel scandal which saw five million barrels of contaminated fuel being sold under very questionable to an unlicensed company called Movenpiina.

BOST in a counter-reaction stated that the expose on the previous administration was the major reason why some people, mainly members of the opposition party were attacking the incumbent because he (Alfred Obeng) was doing the right thing concerning the handling of off-spec product sales which is part of their normal trading activity. The attacks, say his supporters were just to destabilize him to divert his focus from the right things he has started.

According to a statement issued by BOST in June this year, it was evident that several millions of dollars were being paid for contracts that were yet to be fully executed during the tenure of the previous administration. Similarly some funds had been siphoned through dubious means to the detriment of the company.

The statement said Kwame Awuah-Darko created a fictitious account in the name of “Chief of Staff Sundry account” and transferred an accumulated amount of GHS 40.5 million over a period of 13 months with the help of the then Acting General Manager, Finance. The last payment into the account was effected on January 2017 just before Mr. Alfred Obeng Boateng took over as the MD. The Acting General Manager, Finance is on interdiction in connection with the issue.

It further added that another staff in the Trading Department took products procured by the new MD worth over $33million and gave them out without the MD’s approval to honour a dubious holding certificate created by Kwame Awuah-Darko. The staff in question has been interdicted to enable management investigate the matter.

Under the old administration an overpriced contract of $39 million was awarded to Rolider to build BOST’s head office under sole sourcing. Mr. Alfred Obeng Boateng however directed that the contract be suspended which the beneficiary company has agreed in principle to reduce the contract price. A contract of $19m was similarly awarded to Amandi to construct a pipeline from Accra Plains Depot to Akosombo depot but even though the pipeline to be laid, is still lying in America, Kwame Awuah-Darko signed to commit BOST to paying the company and allegedly took his share of the contract sum. The statement indicated that the new MD has suspended the contract to pave way for thorough investigation because he believes that it was overpriced.

It added that Kwame Awuah-Darko signed a contract with Merson Capital to source funds for BOST to embark on projects, on 22nd July, 2014 but it failed to bring any money to BOST. Meanwhile, BOST was paying $ 50,000 per month to the company for over 3 years. Surprisingly the former MD paid ‘success fees’ of $ 89,000 for the mere fact that the company arranged a meeting with a supposed investor which actually never materialized, in addition to the sum of US$1,800,000 paid over the 3 years.

The new MD has suspended the contract to prevent further wastage of BOST’s funds. Curiously those who are claiming that the off-spec product which was sold has found its way onto the market have not been able to name even one filling station selling the product BOST insists. This, claim Mr Boateng’s sympathizers has been done simply to tarnish his reputation. It is also important to note that, the importation of the recent off-spec product in question occurred in January when Alfred Obeng Boateng had not yet taken office, the statement alleged.

As the play of words and political equalization hold sway, the Minority in Parliament, in a press conference called on government to interdict Mr Boateng under whose watch the company sold the five million litres of contaminated fuel to an unlicensed company. They accused him of causing a financial loss of GH₵14.25 million to the state through sale of the contaminated fuel.
BOST, NPA INCONSISTENCIES 

The anonymous document, “BOSTGATE SCANDAL: Open Letter to His Excellency the President of the Republic of Ghana” indicated BOST in its communication has deliberately clouded the facts of the matter by referring to the products as off-spec to legitimise its actions in line with Mr. Awuah-Darko previous suspicious slop trades.

The BOST Public Relations Officer (PRO) and Senior Union President were on Joy Fm repeatedly saying that the volume released to Zupoil was just 100,000 litres. However the NPA on the same day of the BOST claim confirmed that 471,000 litres had been released to Zupoil and an additional 380,000litres loaded but seized.

In the same radio interview, in one breath, the PRO indicated that products had been sold to some steel factories and in another breath, she said that no products were released to any industry. BOST in its press statement on the 22nd of June 2017, indicated that it had inspected the premises of Zupoil and was convinced that their storage facility could not accommodate the volume of product alleged to have been released to it.

The document intimated that intelligence has it that the Zupoil makeshift facility has a maximum 500 thousand litre capacity and not the five million suggested in the press release.

The National Petroleum Authority (NPA) on the other hand reported that it could not account for 47,000 litres out of the 471,000 litres during its first inspection. In an interview later with Joy FM (two days later), it reported that the product was found in another tank at Zupoil. How could this be in the sense that tanks are visible to any technical person in this industry. How did a tank suddenly surface overnight? This does not add up.

NPA in its investigations reported that Movenpiina and subsequently Zupoil were not licensed to undertake any commercial activity in the downstream petroleum industry. Their activities therefore infringe on section 11 of the National Petroleum Authority Act 2005, (Act 691) indicating NPA would take appropriate legal action against the said companies.

The NPA ACT 691 is very clear on this matter. Section 11 (I) of Act 691 states that “A person shall not engage in a business or commercial activity in the downstream industry unless that person has been granted a licence for that purpose by the Board.” It has been argued that there are no licensed waste oil processing companies. This is untrue in the sense that Glasbrown Ltd and Batcco Investments are duly licensed with the NPA to operate as waste oil processing companies. They have been in operation for over three years.

MINORITY AND BNI DOG FIGHT
Beyond the attempt by BOST to dispute claims by NPA that it dealt illegally with a company that was not qualified under the law to engage in the downstream sector, it further sought to justify its sale of contaminated fuel to Movenpiina because it was the only company that offered to buy the contaminated product at GH₵1.30 which then sold it to Zupoil at a price of GH₵1.32 and thus made a marginal profit of GH₵100,000.

The Acting Chairman of the Energy Committee of Parliament, Mr. Emmanuel Akwasi Gymafi at a press conference applauded Mr Boateng for the sales price of the contaminated product, which at GH₵1.30, is 86 percent higher than what obtained in the past and indeed is the highest value the nation has ever earned from the sale of off-spec fuel.

Simultaneously, the Member of Parliament for Aburi Asebu-Kwamankese, Elvis Maurice Donkor said BOST should be commended for making a whopping GH₵1.5 million accrued from the sale of the contaminated fuel to Movenpiina.

In a knee jerk reaction, the Minority alleged that Movenpiina was chosen to purchase the contaminated fuel on May 19, 2017 when the company had not been registered as a limited liability company and it only got to be registered on May 29, 2017, 10 days after the offer to the same company to buy the five million litres when it held no license from NPA to engage in the business.

The Minority in Parliament with the backing of CSOs and policy think tanks strongly called for a high-powered committee to investigate these and other related inappropriate actions, determine the extent to which these have affected the economy and the efficiency of BOST and whether the latter’s operations are being managed in accordance with sound business principles and prudent commercial practice.

This further culminated in the formation of an eight member investigative committee constituted by the Minister of Energy Mr. Boakye Agyarko to investigate into the matter.

According to myjoyonline news portal, a joint investigation conducted by the BNI and national security said it found nothing wrong with the decision to sell the contaminated fuel to Movenpiina Company Limited.

The investigations also established no direct relationship between MD of BOST, Mr. Alfred Obeng and Movenpiina as alleged by many seeking to question the conduct of the BOST MD.

A portion of the BNI report said: ”The product contamination occurred on January 18, 2017, and the MD for BOST assumed office on January 23, 2017, and cannot be held responsible for it.”

Meanwhile, the Minority Leader Haruna Iddrisu has accused the BNI of a cover up in the BOST contaminated fuel saga. He claimed what happened at BOST is a clear case of corruption that the government ought to handle, with the seriousness it deserves. Addressing the media at Parliament, Mr Iddrisu said the findings cannot be accurate.

The Minority leader said the order by the BNI to the Ministry to discontinue its investigations is an attempt by government to cover-up the huge fraud at BOST.

Mr Haruna Iddrisu, intimated that the action by the BNI was bizarre and sensed a cover-up by the government on an issue which borders on fraud, corruption, and abuse of office.

Reports on Ghanaweb news portal indicated that a Deputy National Organizer of the opposition National Democratic Congress (NDC), Mardi Jibril, similarly accused President Nana Akufo-Addo of using the BNI and national security to cover-up the controversial sale.

According to him, the president and the New Patriotic Party (NPP) are being threatened by Member of Parliament for Assin Central, Kennedy Agyapong that he will make damning revelations as to how the party won the 2016 polls, should they force the Mr Obeng to resign.

“The Energy Minister instituted an 8-member committee to investigate the matter and so why did the BNI failed to allow that committee complete its work? I am also aware that the Minister did not inform the president before setting up the committee. The Energy Minister is also eyeing the presidency and so he wanted to use the committee to investigate the rot but because of the irreparable damage that will come after the investigations, the BNI was asked to cover it up with their shoddy work,’’ he alleged.

A Minority member in Parliament, Adam Mutawakilu also lashed out at the BNI and national security for covering up the rot at BOST. Speaking to a journalist in Parliament Tuesday July 4, the Minority ranking member on Mines and Energy questioned the credibility of the report produced by the BNI, describing it as “lousy”.

Mutawakilu charged the President and the Vice to be truthful to Ghanaians and investigate the issues properly.

Former Deputy Information Minister in the John Dramani Mahama administration, Felix Ofosu Kwakye on his facebook page described the supposed investigation carried out by the Bureau of National Investigation and the National Security as a farcical cover up attempted by the government.

The Alliance for Social Equity and Public Accountability (ASEPA) in a press release on Wednesday, June 5, said the report is “very unfortunate and diversionary”.

In the release, the Executive Secretary of ASEPA, Thompson Mensah, said the group “believes irrespective of the work that BNI has done, the whole case needs a further look into”.

The release indicated that “the BNI and National Security may have been consumed by their mandate which is to look at matters of security concerns and may not have gone further to interrogate the matters of corruption and conflict of interest”.

STRANEK SUED BOST, NPA, OTHERS OVER CONTAMINATED FUEL SAGA

According to Citifmonline news portal, after several groups and individuals including the Minority in Parliament accused the Energy Ministry of conniving with the BNI to cover up the scandal, a claim government had disputed, a Non-Governmental Organization (NGO) called Strategic Thinkers Network-Africa sued Mr Obeng, Movenpinaa Energy, Zupoil and MacWest over the contaminated fuel saga.

The NGO in its writ argued that the entire transaction was “illegal,” “fraudulent” and with potential to cause financial loss to the State, and is therefore null and void and of no effect.”

It is however praying the court to declare the transaction between BOST, Movepinaa and Zup Oil as “illegal, unlawful and in clear violation of Section 16(2) (c) of the Public Procurement Act, 2003(Act 663) as amended by the Public Procurement (Amendment) Act, 2016 (Act 914).”

The Network is also urging the court to declare the “decision to single source the sale of the contaminated fuel products to the 4th Defendant [Movepiina] by the 2nd Defendant [BOST] acting through the 3rd Defendant [BOST MD] is in clear contravention of Section 35 and 40(1) of Public Procurement Act, 2003, (Act 663) as amended by the Public Procurement (Amendment) Act, 2016 (Act 914).”

“A declaration that the activities of the 4th and 5th Defendants in engaging in downstream petroleum activities without licenses is in violation of Section 11 of the National Petroleum Authority Act, 2005 (Act 691). An order of the Honourable Court is sought setting aside the entire transaction on grounds of illegality and fraud,” the NGO added in the writ.

INVESTIGATE BOST SCANDAL AGAIN

The Minority in Parliament and policy think tanks including IMANI Ghana, have called on President Akufo-Addo, to initiate fresh investigations into the matter to prove his commitment towards fighting corruption.

According to IMANI, the report by the BNI clearing BOST of any wrongdoing as announced by the Minister of Energy, is not only baffling but “juvenile” and “delinquent.”

“This whole mockery of governance can be made clean again by a singular act of the President for fresh inquiry into the activities of BOST in the last eight years, and all persons liable for fuel fraud to be held accountable. But we want immediate answers to the present fraud. It is simply too early in the day for a new government with boundless optimism,” a statement signed by President of IMANI Ghana, Franklin Cudjoe stated.

ENERGY MINISTER LIED, THERE IS NO BNI REPORT-DAILY POST REPORTAGE

After the hullabaloo in the month of June, a Tuesday 8th, August publication by the Daily Post hit the streets, headlined: Agyarko Lied! There is no BNI report as he claimed exonerating BOST BOSS of illegally selling 5million litres of contaminated oil.

The paper further reported that investigations conducted by it revealed that Mr. Boakye Agyarko, Minister for Energy lied when he claimed a BNI report has exonerated Mr Boateng of illegally selling of five million litres of contaminated fuel to Movenpiina.

According to the paper, no such BNI report on the BOST scandal exists. Neither the BNI nor national security issued any report on the BOST contaminated fuel scandal as Boakye Agyarko claimed. The newspaper claims the minister just told the press the BNI has issued a report but incredibly, the media were never given a copy of the report nor did they bother to ask for a copy of the so-called report – they simply swallowed hook, line and sinker the lie the Energy Minister told them.

ENERGY MINISTER CONSTITUTE NEW INVESTIGATIVE COMMITTEE

In a new twist, after the several accusations and counter-attacks, the Minister of Energy, for the second time inaugurated a nine member investigative committee on Thursday 10th August to look into the matter.

The Lawrence Darkwa committee is to determine the circumstances that created the off-spec product, review the procedures undertaken by BOST to evacuate the product, ascertain the quality and remaining quantity of the product, determine if the product can be corrected, and if not, determine the alternative use for the product and review the transaction.

The events at BOST in the recent past and present administrations smack of corruption, irresponsibility and the culture of non-accountability. The BOST saga however became a debate between the communicators of the NDC and NPP over who was more crooked while millions of dollars of the tax payer’s money was washed into the drains with impunity by supposedly competent people who Ghanaians have entrusted with their destiny.

 

 

 

 

 

 

 

 

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