Mirroring Two Expectant Projects In A’Ibom

Methanol plant
Methanol plant

By: Israel Umoh

Once upon a time, Akwa Ibom State stood still. Uyo, the state capital wore a new look. People from various local government areas converged at various venues for the reception of the august visitor. Traditional dancers trooped out and twerked their bodies. Pellets of sweat formed on many faces during the commissioning and ground-breaking ceremonies of the two projects. The hope of turning the hitherto civil service state to an industrial hub in the Gulf of Guinea was imminent.

That was the ground-breaking ceremony of the Oqua Gas plant and commissioning of the $600 billion gas processing facility initiated by Seven Energy Frontier Oil Limited and the Accugas Limited in conjunction with the Akwa Ibom State Government in Esit Eket. Another was the ground-breaking ceremony of the $I.5 billion (US$1.8 billion?) Methanol Plant located in Ibeno Local Government Area of the state.

It was a grand state function. A few days to the grand finale, the Protocol and security outfits of the Presidency in Abuja had temporarily relocated to Uyo. Eventually, August 13, 2014, berthed. Goodluck Jonathan, the then Nigerian president, Allison Dezeani-Madueke, then Minister of Petroleum Resources in tow, arrived at the Victor Attah International Airport, Uyo for the epoch-making events. Godswill Akpabio, then the state governor adorned in the usual Akwa Ibom traditional, ceremonial outfit- a white tapering shirt, red-stripped wrapper with a red cap to match reported for the reception.

Udom Emmanuel, then a fresh-minted Secretary to the State Government appeared in his ceremonial outfit. Of course, he needed to dress to kill because of his immediate past boss, Jim Ovia, the chairman of Zenith Bank PLC, was the main sponsor of the projects in collaboration with the state government.

At an elaborate state function in Uyo, Jonathan said: “The nation’s gas known to be of much quantity than oil, when maximally utilised, will not only boost the economy and create employment but will to a very large extent, reduce cases of gas flaring to its barest minimum by 2020.”

Speaking after laying the foundation stone of the Methanol Plant, Jonathan commended Akwa Ibom State Government for partnering the private sector in the promotion and development of infrastructure in the state.

He expressed optimism that the project when completed, would create employment opportunities for Nigerians and would encourage non-oil investments.

He commended Ovia for the partnership, adding that the industrialisation effort which was worthy of encouragement will also complement his administration’s transformation agenda.

Jonathan added that the Federal Government was committed to any feasible investment in the non-oil sector as it would promote and encourage the expansion of the country’s economy.

Sadly after six years after the colourful ground-breaking ceremonies, the gas processing facility initiated by Seven Energy Frontier Oil Limited and the Accugas Limited and Methanol Plant appear as pipe projects. Both projects were fathered by Mr. Ovia as the Chairman of the Quantum Petrochemical Complex.

Two schools of thought emerged on the proposed siting of the projects in the state. One opined that Ovia might have wanted to sponsor the projects with the hope that Udom, his one-time Executive Director in Zenith Bank would midwife them to recoup the costs of investment. Another school was that Ovia wanted to use the projects as a smokescreen to convince the then-governor on the need to support the aspiration of Udom as the next governor. Anyway, the schools of thought are neither here nor there.

But in all seriousness, Ovia who is also the founder of Zenith Bank, one of the largest commercial banks in Nigeria has the financial capacity to execute and inaugurate the projects. He also owns prime real estate across Nigeria, and mobile telecom operator Visafone, which has three million subscribers.

Dubbed the Godfather of Banking by Forbes Africa, the Delta-born banker earned this title by building Nigeria’s largest bank. Ranked 325th in the world as of 2016, Zenith Bank has more than $16 billion in assets today across over 300 branches in Nigeria, with a strategic international presence in the UK, Dubai, China, Ghana, Sierra Leone and The Gambia.

He had always instilled a high level of corporate governance across the Bank; enabling it to achieve an $850 million GDR listing on the London Stock Exchange in 2013. In 2017, the bank issued a $500m Eurobond that was four times oversubscribed and priced better than the equivalent home country sovereign bond.

After a nine-month pregnancy, an expectant mother becomes worried if she does not deliver the baby. Though industry has some years to undergo incubation process, six years seems reasonable for the commencement of preliminary works (except it is done in this case) to show commitment and readiness of the projects to zooming into life.

However, for Seven Energy International, Savannah Petroleum, the British fossil fuel giant, has acquired a majority stake in it for an undisclosed amount.

Seven Energy, the gas producers, whose main production asset is the Stubbs Creek, a marginal field in Akwa Ibom State had a 62.5 percent equity interest in the Universal Energy whose office and signpost are still adorning the Banking Layout, Uyo.

Seven Energy founded in 2004 operated in Nigeria through its wholly-owned subsidiaries, Septa Energy Nigeria and Accugas, with headquarters in Lagos and London. Troubled over recent years, Seven Energy has had several defaults on its debt-servicing obligations as it took a beating from a severe liquidity challenge.

Seven Energy, which prided itself as the leading integrated gas company in South-east Nigeria had announced in November 2017 that it had entered into a transaction for a comprehensive capital restructuring. This has resulted in the sale of the oil and gas exploration, development, production and distribution to Savannah Petroleum.

Exactly two years after the commencement of negotiations, Savannah Petroleum announced that the transaction Seven Energy had been completed.

With the deal, the British firm now owns an 80 percent stake in Seven Uquo Gas, which in turn holds a 40 percent participating interest in the Uquo field located in southeast Nigeria. It also owns a 51 percent interest in the Stubb Creek field located in southeast Nigeria, through the 100 percent ownership of Universal Energy Resources.”

In addition, the firm also acquired an 80 percent interest in the Accugas midstream business, comprising the 200mmscfd Uquo gas processing facility, a 260 kilometres pipeline network and long-term gas sales agreements with downstream customers.

For Methanol Plant, it is alleged that the site is overgrown with wild weeds. “The once beautiful venue on the day of ground-breaking is today an eyesore,” an eyewitness submitted.

Since the government is a continuum, Governor Emmanuel should have followed up and ensured that the projects started by his predecessor are executed (if not done) and inaugurated in the interest of the state. Unfortunately, ground-breaking ceremonies have become a recurring index and perhaps a policy of the state government for years now.

For instance, Emmanuel performed the ground-breaking ceremony for a petrochemical the company, Delmar Petroleum and Jetty located at Itak Idim Ekpe, Ibeno local government area of the state in June 2016 and that of a Bus Assembly/Armoured Personnel Carrier Plant at Ikot Ukap, Ekim and Obong Itam in Itu Local Government Area on July 13, 2015. These projects are still at the conception stage.

Undoubtedly, these projects would have provided gainful employment opportunities for the jobless and open up the economic horizon by launching the state into the path of steady economic prosperity.

As a matter of urgency, Akwa Ibom State House of Assembly under its oversight function should carry out thorough investigations into the acquisition of shares of Seven Energy in which Universal Energy is a subsidiary with a bid to returning the state accruals to the pool for use in the execution of other development projects for the masses.

Moreover, the House should invite Governor Emmanuel or his representative and Jim Ovia to brief Akwa Ibom people on the state of the multibillions dollar Methanol Plant. Has it been completed? Is the project still in progress or will it not continue? Did the state government pay its counterpart funding or did the government (a partner in the project) provide an enabling environment to the company as contained in the Memorandum of Understanding (MoU) agreement (if any)?

Since state funds were involved, the Economic and Financial Crimes Commission (EFCC) should investigate the issues and bring the culprits to book.

Patriotic Akwa Ibom people are enjoined to show concern about the plights of their jobless brothers and sisters by finding out the state of the projects. Where wuru wuru seemed to have been perpetrated, let them ask for returns of the state money. Silence is no more golden!