The Bureau of Public Procurement (BPP) is moving, albeit slowly, to grant a certificate of no objection to the $23 million contract granted to Manitoba Hydro International (MHI) to manage the nation’s transmission company, Transmission Company of Nigeria (TCN), for the next three years, BusinessDay learnt yesterday.
The director-general of the BPP, Emeka Eze, has held consultations with key parties involved, including those responsible for regulation and privatisation, following directives by President Goodluck Jonathan to rectify any perceived anomalies with the contract.
According to the president’s schedule, the formal order from BPP must reach the president’s desk by today and he is then expected to grant an approval in principle before flying out to attend the D-8 Summit scheduled for Islamabad, Pakistan.
According to sources at the presidency, Vice President Namadi Sambo will have the responsibility of securing the approval of the Federal Executive Council (FEC) in a matter of weeks to close what has become the most controversial chapter in the decade-long attempt to privatise the nation’s power assets.
Before now, Eze had curiously declined to issue the certificate of no objection and his position caused national outrage last week when it emerged that he had recommended that the president cancel the TCN contract on grounds that have since been dismissed by the National Council on Privatisation (NCP).
Meetings were held in Abuja yesterday among officials from the BPP, BPE and the regulator office, and although details of that meeting remained sketchy by press time, it was learnt that BPP may have made the unusual move of seeking to re-negotiate the contract to exclude the crucial role of market operation from the scope of MHI’s authority.
The market operator (MO) currently manages the huge flow of subsidy funds between the government and gas suppliers and it is now believed that civil servants and their political masters at the Ministry of Power are unwilling to let go of this juicy department.
BusinessDay reported yesterday that President Jonathan and his number two have now thrown their weight behind the retention of Manitoba as the manager of TCN, after concerted attempts to torpedo the Canadian firm.
The president is to seek a strong pro-reform pair of hands as ministers of power to provide a firewall against future manoeuvrings capable of undermining the transformation of the power sector.
According to analysts, this strong support of the president and his vice for the retention of MHI is bound to have a calming effect among the investor community, which had become quite disturbed after word leaked that the president had approved the memo by the BPP seeking to cancel the Manitoba contract.
BusinessDay also learnt that those who played key roles in the ignoble attempt to torpedo Manitoba from TCN may now face severe sanctions in light of strong evidence that the attempt to truncate the contract of MHI was designed to ensure the emergence of Power Grid Corporation of India (PGI) as the management contractor.
Documents seen by BusinessDay showed that PGI had through a petition sent on April 11, 2012 to the presidency protested its non-selection as the preferred management contractor for TCN.
The company then went ahead to lobby influential persons in the presidency asking that the process that led to the emergence of MHI be re-examined.
The company’s intense lobby resulted in the BPP raising a strange memo on November 2, which was leaked to the press, to query the process leading to the emergence of MHI.
In the memo, the BPP had alleged that the BPE “misled the National Council on Privatisation (NCP) in adopting the use of a procurement process that was suspended in 2006 instead of re-advertising for the project to enhance competition and value for money.”
The BPP also alleged that the $23 million contract given to MHI was overpriced, but the bureau failed to enumerate the huge difference in the new contract, including an obligation by MHI to meet 18 crucial milestones during its three-year contract cycle.
But in a strong rebuttal put forward by the NCP, a copy of which was seen by BusinessDay, the NCP described the BPP’s position as “an insult on the office of the vice president, all NCP members and the NCP’s technical committee members since it assumes that they are incapable of figuring out on their own what is in the national interest.”