NPA’s Handling Of Warri Port Dredging Contract Drags Nigeria Into Fresh Negative Spiral

 

Allegations of bid rigging and dubious “arithmetic correction” that saw the emergence of a company whose parent organisation was indicted for fraud in Switzerland with an order to repay Swiss Franc 36 million (US$ 37.3 million) of illegal profit have continued to dog the $44.88 million Warri Channel Dredging contract even as the Nigerian Ports Authority (NPA) may have succeeded in getting the EFCC off its tail.

But the contract which was to increase the depth of the Escravos channel to make it navigable for bigger vessels has generated a backlash for Nigeria within the international business community. While the Economic and Financial Crimes Commission has cooled its investigation of the saga, that the House of Representatives committees on Ports, Harbours and Waterways and Public Procurement has continued with their enquiry that has reinforced the perception by foreign governments that NPA may have compromised its own procurement process.

The main sore point is the choice of Dredging International Services Nigeria (DISN) Limited, a subsidiary of Dredging International Services (Cyprus) Limited, said to be involved in the $20 million bribery of ex-officials of the NPA for the Excravos contract. Dredging International Services (Cyprus) Limited had been indicted of fraud by Switzerland having established that it bribed some NPA officials to the tune of $20 million. In addition to the order to $37.3 million in illegal profit, the company was also fined $1.03 million.

Curiously, the same company morphed into Dredging International Services Nigeria (DISN) Limited, a sister organisation to clinch the $44.88 million dredging contract for Warri Port. Beyond this, the manner with which it won the contract riled its more established rivals with Dredging Atlantic Limited (DAL) and its partners, Westmintser Dredging and Marine (DAW), opting to challenge the choice by NPA.

In its petition, DAL alleged that NPA indulged in under-the-table maneuvers to facilitate the emergence of DISN. Officials of NPA, according to the petition engaged in “arithmetic correction” of the bids submitted by the companies.

The petition signed by the company’s legal adviser, Mr. Liborous Oshoma, also accused the BPP of ignoring an official complaint made by DAL, while hurriedly concluding the administrative review of the bid process.

Mr. Liborous Oshoma, DAL’s legal adviser, accused the NPA of manipulating the publicly announced tender figures of DISL for the contract bid in the course of the arithmetic correction. He said his company’s quote was unilaterally increased to  $44,918,741.22 as against $44,880,348.21 it had quoted.

On the other hand, that of DISL was lowered from $44,998,053.73, the highest at the time of submission of the bids to $44,861,596.81, making it the lowest. Oshoma wondered how the “errors” had to make the highest bidder to eventually become the lowest and preferred after NPA's intervention.

He said DAL emerged first in the technical bid by scoring 89 points as against 75 points scored by DISN, and  that his client also won the commercial bid with a bid sum of $44.880 million as against $44.998 million bid by Dredging International Limited.

Acknowledging that a Swiss court had convicted one of its partners of making payments to certain individuals to facilitate invoice payments at the NPA, Hadiza Bala Usman, managing director of NPA, said

“upon receipt of the Swiss court conviction document, we forwarded same to the EFCC for further investigations, and also submitted copies to the office of the Attorney General of the Federation (AGF). In her words, “A year later, a subsidiary of that company convicted by the Swiss court now bidding for work at the NPA. We then received a petition that the company has been convicted, and we sent the bidding firm a letter on the issue. They sent us a sworn affidavit, claiming that they are not the company that was convicted.

“When we proceeded with the Tender process, the BPP now asked us to do an independent investigation of the sworn affidavit that was submitted to us by the alleged convicted company. From our independent investigation, we found out that even though the bidding company is a subsidiary of the company that was convicted by the Swiss court, each company has different legal personalities and different profiles.

This explanation elicited scepticism among some lawyers, however. “It is incredulous. In the competitive business of dredging, there are other companies even more competent than DISN. There is no moral justification for picking a company associated with a convicted felon. Obviously, NPA's argument is academic. I’m aware the Swiss government and other western countries are not amused by NPA's questionable choice. And that is putting it mildly. It has brought the country to disrepute,” a maritime lawyer, Tunde Manuel Olatunbosun, told Business and Maritime West Africa.

Similarly, a Niger Delta based group, the Niger Delta Good Governance Watch, questioned the propriety of the choice of DISN by NPA given their direct relationship with a sister company convicted of crime. The group stated that  “vested interest” have hijacked the process of choosing the most qualified for the job.

Denying any wrongdoing in the award of the $44.861 million Warri Channel dredging contract, Usman claimed that DAW was being a sore loser as the company had earlier had its contract for the dredging of channel to Calabar port cancelled over alleged poor performance. Oshoma denied the claim pointing out that Niger Global Engineering and Technical Company Limited which has no relationship with his company handled the said Calabar channel project.