Revealed: Why EFCC is probing Kyari, top ex-NNPC officials

THE Economic and Financial Crimes Commission (EFCC) grilled the former Group Managing Director of the Nigerian National Petroleum Company (NNPC) Limited, Mr Mele Kyari, on Wednesday afternoon, over multi-billion controversial contracts, including a near $3 billion refinery outlay, during his tenure.

He is not the only ex-NNPC chief that has been quizzed. Nearly all the former executives who served under him have been invited by the anti-corruption agency to give account of their stewardship. But why is the EFCC interested in Mr Kyari and other ex-NNPC chiefs? Economy Post explains the reasons and why they matter.

According to information obtained by Economy Post from presidency sources, the EFCC is probing a controversial $7.2 billion spent on refinery turnaround projects under Mr Kyari. Sources said the presidency and the EFCC were shocked that the humongous amount put into the nation’s 4 refineries in Port Harcourt, Kaduna and Warri without results.

There is also the nearly $3 billion outlay spent on the rehabilitation of the refineries without any positive result. Under Mr Kyari, refinery rehabilitation contracts were awarded to companies – mostly foreign firms – without results. This is what is currently being probed. It is not clear whether the nearly $3 billion ($2.97 billion) reportedly invested in the refineries is part of the $7.2 billion under scrutiny.

READ ALSO: NNPC under Kyari spent nearly $3bn on Nigeria’s three refineries. None is working now.

The anti-graft agency is also probing the disbursement of $1.55 billion to the Port Harcourt refinery, $740.6 million to the Kaduna refinery, and $656.9 million to the Warri refinery.

“What we know is that several firms that were given the jobs to rehabilitate the refineries did not fulfil the contracts despite that some of them were paid upront. The EFCC is interested in knowing who got what in the contracts and how some of those connected with the EFCC and its directors arranged for companies that executed those shoddy contracts,” a presidency source said.

Secondly, an EFCC source said the agency is also chasing an additional N10 billion and $13 million allegedly siphoned through inflated contracts and questionable transactions in the rehabilitation projects under Mr Kyari.

Thirdly, Economy Post was told that the anti-graft agency brought in an auditing firm who probed the finances of the NNPC under Mr Kyari, especially those of the four refineries, and gave damning reports about them.

Several illogical decisions were taken by the managers of the refineries while Mr Kyari was the GMD. In 2020, the Port Harcourt refinery employed 487 new staff members with an average monthly salary totalling N672,713. Between 2019 and 2020, the refinery employed 1,162 new staff, paying N41.163 billion in annual salaries and wages, according to The ICIR.

Staff pension, gratuity and ‘long service award’ stood at N77.76 billion in 2020 as against N63.41 billion in 2019. This is despite that between 2017 and 2020, the company comprehensively lost N241.609 billion and generated a revenue of just N6.27 billion. In fact, in 2020, the refinery made zero revenue.

READ ALSO: Nigerians question NNPC’s $2.8bn deal with Dangote Refinery

Similarly, the Warri refinery made a revenue of N4.429 billion in 2017, 2018 and 2019, but incurred a loss of N188.44 billion within the same period. Total assets stood at N43.92 billion in 2017, while liabilities were valued at N333.43 billion. In 2018, liabilities were estimated at N383 billion while assets totalled N19.36 billion. In 2019, liabilities stood at N485.96 billion while total assets amounted to only N79.43 billion.

Yet, directors increased their remuneration from N270.090 million in 2018 to N332.137 million in 2019. In 2017, salaries, wages and allowances of workers were valued at N12.9 billion.  This increased to N13.755 billion the following year. In 2019, it reduced to N12.348 billion.

Also, Kaduna refinery made a revenue of N2.278 billion between 2017 and 2019 but incurred a loss of N241.527 billion, The ICIR reported from the refinery’s financial statements. These are what the EFCC is probing.

Moreover, presidency insiders told Economy Post that the anti-graft agency is equally poring over documents relating to the controversial crude oil contracts.

“The EFCC is also looking at several joint ventures (JVs) and a controversial $2.8 billion deal with Dangote refinery, which cost $36 million in transaction but reduced the NNPC stake from 20 percent to 7.2 percent,” a presidency source said.

The EFCC is also suspecting, without proof currently, that certain contract sums were received by Mr Kyari.

Kyari’s four bank accounts frozen

The federal high court in Abuja, on August 19, ordered the temporary freezing of four Jaiz Bank accounts linked to Mr Kyari over alleged fraud.

Trial judge, Justice Emeka Nwite, issued the order after an ex-parte motion was filed by the EFCC. The EFCC numbered Mr Kyari’s account details as: Jaiz Bank account number: 0017922724 with account name, Mele Kyari; Jaiz Bank account number, 0018575055 with account name, Guwori Community Development Fund; and Jaiz Bank number, 0018575141, with account name, Guwori Community Development Foundation Flood Relief.

An EFCC official told the court that “upon receipt of the petition referred to in Paragraph 4 above, my team carried out several investigation activities which included seeking and obtaining bank records from commercial Banks.”

READ ALSO: Multi-billion naira fraud in NNPC puts ex-GMD Kyari on the spot

IThe official noted that the investigation revealed that the sum of N661.4 million, which was suspected to be a proceed of unlawful activities, was warehoused in four different accounts belonging to Mr Kyari.

“That, these funds were traced to the suspect, Mele Kolo Kyari, who is the former Group Managing Director (GMD) of Nigerian National Petroleum Corporation (NNPC). That the suspect opened various accounts in Jaiz Bank which has been used to receive suspicious inflows from NNPC and various oil companies that have dealings with NNPC.

“That bank records revealed that these accounts are controlled and managed by Mr Kyari through his family members who are acting as fronts.”