January 26, (THEWILL) – Fifty-Two years after it was conceived by the Federal Government in 1972 as a 3,050MW hydroelectric facility to help realise the goal of 23,000MW installed capacity by 2023, the Mambilla Hydroelectric Power Project in Taraba State, is now a subject of arbitration over an alleged failed contract and litigation for alleged fraud.
At the centre of the arbitration in Paris, France, are two former presidents, Olusegun Obasanjo and Muhammadu Buhari. At the centre of litigation by the Economic and Financial Crimes Commission, EFCC, are two former Ministers of Power who served under both former Presidents, Olu Agunloye (2002 -2003) and Saleh Mamman (2019-2021).
“The appearance of the two former Nigeria’s Presidents, Olusegun Obasanjo and Muhammadu Buhari before a Paris court to testify on the botched Mambilla Power plant deal underscores significant scrutiny surrounding major infrastructural projects in Nigeria and their implications for governance and accountability,” Executive Director of Rule of Law, Accountability Advocacy Centre, RULAAC, Mr Okechukwu Nwanguma, told THEWILL on Friday.
Nwanguma contended that the case highlights past decisions and mismanagement that have impeded the country’s energy development, impacting productivity and economic growth.
Indeed, the World Bank’s Power Recovery Programme, PSRP, estimates that Nigeria’s businesses lose $29 billion annually due to unreliable electricity.
The global bank, which is helping the country improve its electricity access through the Nigeria Electrification Project, NEP, estimates that, because of the prevailing challenges, the electricity deficit is about 40 per cent nationwide, while 73 per cent of the rural population is off the national grid.
Moreover, the International Hydroelectric Power Association, which says hydro-electric power is the largest single source of renewable energy providing more than 90 per cent of all stored energy in the world, has disclosed that countries like Egypt, South Africa and Morocco which started similar hydroelectric power plants like Nigeria have been able to inject between 16,000 to 22,003 hydroelectric power into their overall generating capacity and increased their mega wattage to between 59,003 for Egypt and 58,095 for South Africa.
Currently, Nigeria has 12,000 installed power generating capacity with only 5,000 output, managed by inefficient GenCos, plagued by decayed infrastructure and dogged by vandalism leading to regular grid collapse and blackouts.
Nonetheless, a dependable source at the EFCC, who spoke to THEWILL on the condition of anonymity, said the steps taken by both former presidents unconditionally were commendable for purposes of due process and transparency, though connected, “the litigation by the commission against the two ex-Ministers regarding alleged fraud connected to the Mambilla Power project, were different litigation from that which both former presidents are handling.”
FORMER PRESIDENTS OBASANJO, BUHARI IN PARIS
Following a $2.3 billion arbitration proceedings against Nigeria by Sunrise Power and Transmission Company Limited at the International Chambers of Commerce, ICC, in Paris, France, former Presidents Obansanjo and Buhari travelled to the French capital last week to testify in an alleged breach of contract by the Federal Government of Nigeria. Mr Leno Adesanya, is the founder of Sunrise Power Company.
Sunrise Power claims to have been awarded a $6 billion contract to build, operate and transfer the Mambilla power plant by the Olusegun Obasanjo Administration in May 2003. Also, it alleged a breach of contract by the Nigerian government for which it is seeking monetary compensation of $2.3 billion to cover what it had spent on financial and legal consultancy.
Buhari returned to Nigeria on Friday, according to a video shared by an aide, Bashir Ahmed. Obasanjo, who was also in Paris on Friday, said he had testified before the ICC.
According to Obasanjo, “I volunteered myself to testify in this case. Nobody sent me to do so. President Tinubu did not ask me to do so as speculated. I didn’t speak to anybody on my intention to testify,” Mr Obasanjo said, in an interview with PREMIUM TIMES from Paris.
“I decided to testify because of the statement made on the matter by Olu Agunloye. I considered his claims atrocious and thought it necessary to set the records straight,” he added.
Agunloye, who is being accused of $6 billion fraud in the Mambilla power project has accused Obasanjo of deliberately spreading falsehood to cover his own record regarding the power project.
In a statement obtained by THEWILL on Friday, Agubnloye, who is at present, the National Secretary of the Social Democratic Party, SDP, alleged that the government was seeking to use him as a scapegoat to portray systemic corruption to the arbitration panel.
According to him, his challenges sprung from personal conflicts between President Obasanjo and two of his associates: former Vice President Atiku Abubakar and Adesanya, owner of Sunrise Power.
He said, “The government seeks to use me as a scapegoat to portray systemic corruption to the arbitration panel and undermine Sunrise’s claims. Challenges stem from personal conflicts between President Obasanjo and two of his associates: former Vice President Atiku Abubakar and Leno Adesanya, owner of Sunrise Power Company.
“Obasanjo feigned ignorance of the BOT contract during his presidency and later distorted the facts in public and judicial settings.
“The arbitration in France arose from actions taken by successive administrations, particularly under President Buhari. In 2017, then-Minister of Power Babatunde Fashola bypassed a 2012 agreement signed under President Goodluck Jonathan with Sunrise and awarded the contract to another company.
“Despite advice from the Chinese government to resolve the dispute amicably, the FGN failed to honour two settlement agreements, leading Sunrise to return to arbitration.
“The government is spreading misinformation and using me as a pawn to divert attention from the actions of its own officials and four former presidents who handled the project over two decades.
OBASANJO AND AGUNLOYE
Obasanjo had blamed his former minister, Agunloye, for mismanaging the Mambilla project between November 2002 and May 2003, when he became Minister of Power. He denied granting the authority to award the contract for the power project and asked Agunloye to publicly disclose who authorised the contract, thereby raising the question of fraud.
In his defence, Agunloye noted that the $6 billion Sunrise Power needed to complete the project was valued by four predecessors and Obasanjo before he himself was appointed Minister of Power. He insisted that Obasanjo gave approval for the project.
The former President in a reported memo to the Attorney General and Minister of Justice, Lateef Fagbemi, a Senior Advocate of Nigeria, noted that he had no objection to Agunloye’s request but asked him “to bring a memo to Council to include comparison with coal-fired plant for 4000MW to 5000MW”.
“What is abundantly clear is that at no time did Dr Agunloye comply with the foregoing directive by bringing a memo to Council to include the [stated] comparison, nor can my directive be stretched to be inclusive of any approval to award any contract to Sunrise Power and Transmission Company Limited or any other person.”
According to Obasanjo, ministers had no authority during his administration to commit Nigeria to contracts beyond N25 million without presidential approval. He described Agunloye’s transaction with Sunrise Power as fraudulent, deceitful and embarrassing.
Moreover, Agunloye’s successor in the Ministry, Senator Liyel Imoke, reportedly denied government’s approval for the project, thus supporting Obasanjo’s position. According to reports, Senator Imoke’s denial was contained in a reply to a letter by a Sunrise Power Director, Engr Tunde Akinbode, seeking the payment of N6 billion for “pre-EPC development of Mambilla.”
Engr Akinbode, in the letter dated August 20, 2003, said the Federal Government’s commitment of N6 billion, as contained in Agunloye’s contract award letter with ref. no FMP/S/6145/S.T/2, was “not enough” and “there will be a need for the government to budget an additional N10 billion in the next budget year.”
Senator Imoke, in his reply dated September 3, 2003, said, “This is to inform you that the Federal Executive Council did not approve the Memorandum recommending your Company for the Mambilla Hydroelectric Power Project. In line with the directives of the Federal Executive Council, the Federal Ministry of Power and Steel is to revisit the development of the project. Fresh documentation will be made available to all prospective developers in due course… you are advised to tender for the project when it is advertised.”
BUHARI AND MAMMAN
Desirous of sustaining the momentum on the project, former President Buhari approved the constitution of two committees for the Mambilla Power Project in 2020, namely, the Inter-ministerial Steering Committee and Project Delivery Committee.
The Minister of Power, Saleh Mamman, chaired the inter-ministerial steering committee, while the director in charge of Renewable Energy in the Federal Ministry of Power chaired the project delivery committee.
According to the then Special Assistant to the Minister of Power on Media and Communications, Aaron Artimas, members of the Inter-ministerial Steering Committee were representatives of Federal Government agencies and Taraba State government as well as federal ministries of Water Resources, Environment, Finance, Budget and National Planning, Works and Housing, Justice, Information and Culture, and Mines and Steel Development.
Others included representatives of the Secretary to the Government of the Federation, National Security Adviser, Nigeria Sovereign Investment Authority and the Nigeria Customs Service.
The terms of reference of the Inter-ministerial Steering Committee included facilitating and fast-tracking the execution and project delivery of the Mambilla hydro-electric power project.
They were to also obtain approval of the loan facility from the China Exim Bank for the offshore component of the project based on the reviewed contract price.
Before this time, Sunrise Power was fuming because the government had since re-awarded the project to Chinese companies.
The engineering, procurement and construction contract for the power project was awarded to a joint venture between China Gezhouba Group, CGGC, a subsidiary of the state-owned China Civil Engineering Construction Corporation, CCECC; Sinohydro and CGCOC, formerly CGC Overseas Construction, in November 2017.
Miffed by this turn of event, Sunrise Power sued the Federal Government at the International Court of Arbitration in France, in October 2017, for unlawful termination of contract. Adesanya’s company argued that Nigeria failed to honour its contractual obligations and sought s $2.3 billion in compensation against Nigeria, claiming it had spent millions of dollars on financial and legal consultants before the contract was cancelled.
The international court awarded Sunrise Power $200 million against Nigeria for breach of contract. In 2020, Nigeria entered a settlement agreement with the company. Buhari then directed the Nigeria Sovereign Investment Authority to source the $ 200 million for the settlement of the court award in favour of Sunrise Power after which it is expected to relinquish all claims to the project. The government explained that the challenge of COVID-19 affected its finances, said Atimas.
On September 1, 2021, Buhari fired Minister of Power, Mamman, alongside the Minister of Agriculture and Rural Development, Mohammed Nanono, claiming that he “found it essential to reinvigorate this cabinet” after a process of “independent and critical self-review.”
The Muhammadu Buhari Administration then withheld payment of the $200 million on the advice of Abubakar Malami, the former Attorney-General of the federation who also told Adesanya of the government’s decision to terminate the agreement.
Unrelenting, Adesanya approached the International Chambers of Commerce in Paris, asking for a second arbitration, in addition to the one initiated in October 2017. In this second arbitration, the company is asking for a $400 million settlement, regarding the failure of the Nigerian Government to honour both parties’ agreement entered into in 2020 to end arbitration.
WHY OBASANJO, BUHARI HAD TO TESTIFY
At the arbitration hearing in Paris, the Nigerian Government had put up a robust defence, alleging fraud and corruption on the part of its public officials in the award of the contract.
Although Buhari arrived Nigeria from Paris on Friday evening and kept mum over his appearance, Obasanjo said he went to Paris willingly to testify before the ICC. The idea, THEWILL learnt, was designed to maintain the country’s position that the 2003 power contract was riddled with fraud.
Efforts by THEWILL to reach Mr Femi Adesina, former Special Adviser on Media and Publicity to the former President and Senior Special Assistant, Media and Publicity, Mallam Garba Shehu, proved abortive as phone calls delivered to their phones were not answered or returned. A source, however, told this newspaper that Mallam Shehu was in Paris with Buhari. The Presidency, however, had washed its hands off reports that it directed any of the former Presidents to appear and testify before the ICC in Paris. This, however, does not mean it failed to keep a tab on every development in the case.
SUNRISE POWER DESERTED AT PROCEEDINGS
Reports of the arbitration proceedings at the ICC last week showed that only witnesses from Nigeria testified from Monday, January 20 through Thursday, January 23, 2024, when the event ended. Thus, while Obasanjo, Buhari, former Power, Works and Housing, Babatunde Fashola and his Water Resources counterpart, Suleiman Adamu, testified as actual witnesses, those listed as witnesses by Sunrise Power failed to show up.
The Cable, which covered proceedings, said “For Sunrise, promoted by Leno Adesanya, its key witness failed to show up to adopt their statements, meaning their statements are deemed abandoned and of no moment.” Agunloye also failed to show up. So, too was a former Attorney-General of the Federation, Michael Aondoakaa who was listed as a witness by Sunrise. The on-line medium said, “he showed up briefly in Paris and returned to Nigeria without testifying.” A third witness listed by Sunrise that failed to show up is a Senegalese lady, allegedly offered to Abubakar Malami, to induce him to sign the 2020 settlement agreement.
EFCC, AGUNLOYE, MAMMAN, ADESANYA
The EFCC source confirmed to THEWILL that though the EFCC last Thursday amended charges against Agunloye, the anti-graft agency is yet to reach him and read to him.
Justice Jude Onwuegbuzie of the Federal High Court, FCT sitting in Apo, Abuja last Thursday, January 23, 2025 granted the prayers of the EFCC to amend charges brought against Olu Agunloye and make him take his plea.
Agunloye is standing trial by the EFCC on seven-count charges, bordering on official corruption and fraudulent award of Mambilla Power Project contract to the tune of $6billion.
Earlier on July 1, 2024, the Prosecuting Counsel, Abba Mohammed, SAN, drew the attention of the court to the amended charge, urging the court to accept same and cause the defendant to take his plea, relying on the provision of Section 216 and 217 of the Administration of Criminal Justice Act, 2015.
However, defence counsel, Adeola Adedipe, SAN, objected to the plea, arguing that the leave of the court must be formally sought and obtained before the EFCC can amend its charge.
Responding, the court directed all parties to furnish the court with authorities in support of the argument canvassed to which the EFCC made reference to the Court of Appeal’s decision in Bovoa v FRN & Anor (2017).
During Thursday’s ruling, the judge held that amendment was not intended to overreach the defendant and cause injustice to him and that a court may permit an alteration or amendment to a charge or framing of a new charge at any time before judgment is pronounced.
Justice Onwuegbuzie adjourned the matter to February 3, 2025 for the defendant to take his plea.
The EFCC alleged that on May 22, 2003, Agunloye awarded a contract, titled “Construction of 3,960MW Mambilla Hydroelectric Power Station on a “Build, Operate and Transfer Basis” to Sunrise Power and Transmission Company Limited, without any budgetary provision, approval or cash backing.
The former minister was also alleged to have on August 10, 2019, corruptly received the sum of N3.6m from Sunrise Power and Transmission Company Limited, and Leno Adesanya for having conveyed the ‘approval of the Government of the Federal Republic of Nigeria for the construction of the 3,960 megawatts Mambilla Hydroelectric Power Station’ in favour of SPTCL, which was done without the approval of the Federal Executive Council.
Claiming that Sunrise’s Adesanya had bribed a former Minister to secure the contract, the EFCC in February 2024, declared Leno Adesanya, promoter of Sunrise Power and Transmission Limited, wanted for “an alleged conspiracy and corrupt offer to public officers”.
Adesanya was mentioned in three of seven count charges against a former Minister of Power and Steel, Olu Agunloye, who is being prosecuted by the EFCC over the $6bn Mambilla hydropower contract.
Agunloye was arraigned on seven charges, bordering on the fraudulent award of a contract and official corruption in January 2024.
Adesanya however pleaded not guilty to the charges.
For Mamman who is being prosecuted by the EFCC on a 12-count charge bordering on conspiracy to commit money laundering to the tune of N33.8 billion, his trial got complicated Last Wednesday at the Federal High Court, Abuja, when the EFCC presented its eight witness before Justice James Omotosho.
The witness, PW8 Abdullahi Suleman, a bureau de change operator, narrated how more than N22 billion was allegedly siphoned from the Federal Ministry of Power, while Mamman was minister. He said the naira equivalent of the money was exchanged for United States dollars through his business accounts.
When shown Exhibit X series, which contained bank statements generated from his companies showing evidence of money inflows into his bank accounts with Strong Field international Projects Limited, Mintedge Nigeria Limited, Prymint Investment Limited, the witness admitted that they were the accounts he gave Maina Goje, an official of the Federal Ministry of Housing to whom he was directed to always give any amount of dollars he requested.
Among some of the notable transactions shown to him on the accounts were; N285,983,285 received on 24th May 2021; N278, 248.611 on 26th May 2021; N320m on 1st January, 2021; N184m on 18 June, 2021; N178,300,285 on 14th July 2021; N75,420, 000 on 5th August 2021; N75,120,000 on December 1, 2021; N68,150,620 and N70,650 on 15th December 2021; N90,247,395 on 12th Jan 2022; N64, 747,627 on 16 February 2022, among others and he agreed receiving them.
The judge adjourned the matter to 23 January, 2024 for continuation of hearing.
“Hopefully, the testimonies by the former Presidents will provide insights into eh government’s handling of such critical projects and the ramifications of international partnerships,” said RULAAC’s Nwanguma, adding, “Ultimately, this situation emphasizes the need for transparency and due diligence in Nigeria’s efforts to develop its energy sector, aiming to restore investor confidence and avoid future pitfalls.”
Amos Esele is the Acting Editor of THEWILL Newspaper. He has over two decades of experience on the job.
