Tuesday, June 28, 2016

State-sponsored corruption at the Gambia National Petroleum Corporation - Part I

A week ago, in a highly unusual move by Jammeh regime that raised a lot of eyebrows, the news reader of the government controlled national television read a press release informing the general public that the Office of the President has discovered "one of the most serious economic crimes in government during the past twenty-two years" of the Jammeh regime.

The release characterized the nature of the crimes committed as being related to the procurement of petroleum that involved personnel at the Ministry of Petroleum, Gambia National Petroleum Corporation (GNPC) and Board of the GNPC.

Because it is out of character for the regime to make such public pronouncements, it raised immediate suspicions when ten senior officials - past and current -  including a former Minister of Petroleum and Chairman of the GNPC were rounded up and speedily arraigned at the Banjul Magistrate Court in less than 48 hours.  It is important to note that even though the ten have been arraigned, the charges against each have neither been specified - at least, not publicly - nor the amounts involved.

A short historical context is essential to appreciate the problem.  Gambia National Petroleum Corporation was created in 2014 to take over the Gambia National Petroleum Company Limited established in 2003.  In presenting the Bill creating the Corporation, Infrastructure Minister, Balla Jahumpa, on behalf of the Vice President Njie-Saidy, said the GNPC Ltd. was created "to serve as the business arm of the government in the oil and gas industry in The Gambia."

The Gam-Petroleum Storage Facility at Mandinari was inaugurated in May 2008 to address the petroleum storage problems the Gambia faced over the years.  The country had outgrown the only facility owned and operated by Shell company Company (Gambia) Limited located in Banjul.

The new facility at Mandinari is listed as part of the Spectrum Group headed by Muhammed Bazzi, Jammeh's business partner and operator of the Brikama electricity power plant. The Mandinari facility, according to official sources, was build at a cost of US $ 50 million.  Initially, equity was split between the Gam-Petroleum holding group, Total International and Gambian and European banks with Total International designated as the exclusive supplier of petroleum products to the facility.

The storage capacity which is now billed as the sub-region's largest largest oil and gas storage container facility is 51,000 metric tons of heavy and light oils as well as LPG.  The facility is expected to eventually serve as a refueling stop and bunkering hub for vessels en route to South Africa and South America.
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Part II will look at the evolving share/ownership structures of these so-called state-owned petroleum companies, the procurement, storage and petroleum retailing practises that led to the massive loss of equity and revenue to the State.  It is inconceivable to think that Jammeh is not part of the scheme.