A former Minister of Power and Steel, Olu Agunloye, has said that former President Olusegun Obasanjo lied when said he did not authorise the award of a $6 billion contract to Sunrise Power at the Mambilla Hydropower Project, Nigeria’s largest power plant, in 2003.
In early September, Obasanjo claimed that Agunloye, as the minister of power and steel, went behind him to award the project.
The former president said he would have sacked the minister if he got wind of the contract award.
Sunrise Power is currently in arbitration with Nigeria at the International Chamber of Commerce (ICC), Paris, France, alleging breach of contract by the federal government.
The company, which claimed to have spent millions of dollars on financial and legal consultants before the $6 billion Mambilla Hydroelectric Power Project was jettisoned, is asking for a compensation of $2.3 billion.
In a second arbitration, Sunrise is demanding $400 million settlement being the terms of the agreement it entered with the federal government in 2020 to end the arbitration.
Nigeria is fighting both claims on the grounds that Agunloye acted illegally when he suspiciously awarded the humongous contract one week before the end of his tenure in 2003.
In a statement, Agunloye said Obasanjo’s claims were misleading and incorrect.
“The former president was not correct when he referred to the award to Sunrise simply as a $6 billion contract (that is, N800 billion in 2003) under his watch.
“In truth, it was a Build, Operate and Transfer (BOT) contract in which the FGN did not need to pay any amount to the contractor, Messrs Sunrise Power and Transmission Company Limited (Sunrise).
“As a matter of fact, Sunrise has not been paid a single Naira or Dollar by the FGN from 2000 till date (14/9/23). Sunrise was to source for funds and execute the project with own funds.
“The investment of Sunrise to construct the Mambilla hydroelectric project up to completion stage to deliver electricity was adjudged at a maximum of $6 billion by four Ministers of Power and the former president (Chief Obasanjo) before I became Minister of Power.
“Sunrise was to recoup his investment from the sale of the generated electricity over a 30- to 40-year period at pre-determined tariffs, also agreed with FGN before May 2003,” Agunloye explained.
He added, “I followed due process and got all necessary approvals for the BOT contract award to Sunrise on 22 May 2003 and there are records to show that the former President Obasanjo propelled the processes from the beginning in 2000 to the end in May 2003.
“In fact, Sunrise started Mambilla project three years before I became Minister of Power and had arranged meetings with Chinese Companies and Chinese President in China in which three Power Ministers and the then President Obasanjo attended between 2000 and 2002 before I was appointed Minister of Power.
“On the very day (28 Nov 2002), that I resumed office as Minister of Power, Pa Obasanjo himself, in a formal letter, handed me his presidential approval on the Sunrise proposal with an instruction that Sunrise be invited “for the final negotiations for the execution of the Mambilla Power Project”.”
Agunloye added that for 20 years, he was never questioned or interrogated about awarding any unauthorised Mambilla contract by any Nigerian president, including Obasanjo.
He said that Obasanjo changed the BOT contract model for the Mambilla power project after his tenure as minister.
“The former President then chose to embark on a new pathway in which Nigeria would execute the Mambilla Power Project by paying from Government own funds.
“The former President decided, therefore, to break the Mambilla Hydropower Project into smaller components, like civil engineering works, hydraulic works, structural works etc. with the intention to award them as separate multiple contracts as Government procurements, on cash and carry basis, for which Nigerian Government would pay mobilisation fees and make other payments in stages to contractors.
“When one of the contractors, which got a component of the Mambilla project awarded by President Obasanjo as $1.46 billion procurement contract, presented its request for a $400 million mobilisation fees, President Yar’Adua scrutinised the contract and cancelled it in 2008 because of proven corruption on the part of officials who served under President Obasanjo between 2003 to 2007,” the former minister said.
He added, “I awarded Mambilla Power Project as BOT at no cost to Nigeria. Former President Obasanjo awarded one component part of the same Mambilla project for $1.46 billion as procurement contract, former President Jonathan signed a 2012 General Project Execution Agreement and former President Buhari and his then Minister of Power, Barrister Babatunde Raji Fashola awarded another component of the Mambilla Project at a whopping $5.8 billion payable by FGN in cash.
“The FGN awarded, re-awarded and cancelled contracts and Agreements at will and now must face the consequences at International Arbitration Courts.
“The result is that the Mambilla Hydropower Project has been stalled for yet another twenty years, and the former President (Chief Olusegun Obasanjo) and others are feeling greatly uneasy about the consequences.”
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