Contrary to insinuations and postings on Social Media that the former President, Ernest Bai Koroma has shares in the National Petroleum Company (NP), an investigation conducted by this writer renders all the allegations false and far from the truth. It was discovered that the former President does not have and never had any stake in the company.
In a bid to get to the truth of the matter, this writer engaged various stakeholders, staff and retired staff of the National Petroleum Company, who were privy to the negotiations prior to the privatization of the company in 1996. It was disclosed that prior to the privatization of the company, the petroleum companies were importing crude oil, which was being processed at the refinery and sold to consumers. This in effect meant that they had to source funds (Foreign Exchange) to import crude oil. However as the rate of the dollar rose and its apparent unavailability, queues were being seen at various petrol stations across the country as the companies lacked the necessary foreign exchange to import the oil.
It was also disclosed that during that period (from the 80s to the 90s) the companies stopped importing crude oil into Sierra Leone. They then folded up selling their shares to others who showed interest in the business. Shell was bought over by Safecon, Mobil bought over by Exxon and later Total, whilst British Petroleum sold its shares to the Government and other shareholders. 60% of British Petroleum shares was sold to the Government, whilst 40% was sold to the late Jamil Sahid Mohamed and Tony Yazbeck; the owners of Precious Minerals Marketing Company (PMMC).
The World Bank got interested in Sierra Leone and looked into the petroleum product and advised for the setting up of a Petroleum Unit. It also advised the Government to privatize the company.
Staff wrote to the Ministry of Trade on their position on privatization. Their request was rejected and they were told to form a company. In a meeting held with PERDIC (the body empowered to deal with privatization and now called NCP) headed by Alfred Kandeh, members of staff of the company were briefed on the process of privatization and the opportunity they have to become shareholders of the new company. Workers were told they could use their severance packages (End of Service Benefits) from BP and buy the 55% of the shares of the Government and the balance 5% will be given to all workers working at the time. 35 of the 150 workers then opted to use their severance package to buy the 55% whilst the rest enjoyed the remaining 5%. The Leone Oil company was then born.
Leone Oil and other interested multi-national companies then placed their bids for the importation of refined fuel. In keeping with the local content policy guaranteed in the constitution, the local company, Leone Oil, won the bid, which was supervised by Arthur De Little, a management consulting firm appointed by the World Bank.
According to investigations, 4 companies bidded for the contract and prominent among them were Elf and Leone Oil. Having won the contract, the company was struggling to get foreign exchange to import refined fuel. They then contacted Addax an international supplier, which had the resources and the exposure in respect of forming a joint venture, which was called Petro-Leone. This became a storage company in which Leone Oil had unfettered access, whether foreign exchange is available or not. This arrangement saw the disappearance of queues on the country’s streets.
According to information got during investigation, Addax had an exposure of $60 million, the sort of exposure which no international company will accept (without any advance payment), or any bank in the country can do. It was further revealed that the jetty built in the 1970s and used by tankers supplying crude oil had been neglected after the refinery began to face challenges. In its dilapidated state it could only handle ten thousand metric ton tankers. Because of the bad state of the jetty many ship owners were reluctant to send their ships to off-load refined fuel and this difficulty was addressed in a negotiation with Petro Jetty (a 100% Addax owned company) and the government (Trade Ministry and State House) to build a state-of-the-art jetty that will accommodate 30 thousand metric ton tankers with the understanding that after recovering its investment, it will hand over the jetty to the Government. This agreement was ratified by Parliament and is with the Ministry of Finance.
All stakeholders and workers who bought the shares from the Government confirmed that the former President Ernest Bai Koroma never had a share in NP and that it is an indigenously owned company which is comprised of former workers of BP, who had used their end of service benefits to buy the shares sold to the Government by BP when the World Bank advised the Government to privatize the company.
Postulations that NP has a monopoly over the petroleum market are misleading as there are 4 Marketing Companies registered with the Petroleum Agency, marketing petroleum products in the country namely: NP SL LTD., Total SL LTD., Leonco SL LTD. Petro-Leone is a storage company developed by both Addax and Leone Oil so that petroleum products will always be available in the country and avert shortage. Experts further stated that if such a venture is frustrated the country will return to the former state of shortage of fuel and long queues will once more surface across the country.
