Talking Drums

The West African News Magazine

Whispering Drums With Maigani

by Musa Ibrahim

Buhari: Nigeria's oil Sheikh

"The only thing necessary for evil to triumph is for the good men to do nothing.” - Edmund Burke.
Many years ago, a French Commissioner of Petroleum Products is said to have told his Prime Minister that: "He who owns the oil will own the world." At the time that statement was made, oil was only marginal to the Western economies in comparison with its importance today. The Commis-sioner's utterance was therefore regarded as something of a prophetic fantasy, something not to be taken seriously. But that was not to be, for even before then, the West had embarked on a high-level of industrialization, a venture which needed oil as the life-blood of the industries created. But with the decrease of their own limited resources and the increase of their rate of consumption, there was a dire need to seek for oil elsewhere outside of their effective area of control.

As if in answer to the oil demands from the West, a monolithic group emerged almost from nowhere. With abundant oil on its shores, and with nothing to do with it, the group decided to come together and form a cartel. The group's aim was two-fold: jockey for power on a global scale using oil as a leverage; and, transform the French Commissioner's statement into reality i.e. own the world.

The Organization of Petroleum Exporting Countries, better known as OPEC, was born twenty five years ago. And in almost twenty of those twenty- five years, the oil cartel has certainly reigned supreme, holding the all- powerful industrial West as well as the market forces to ransom. OPEC's lock on the market gave it a kind of veto power over supply and demand and the price of its crude oil was worth whatever the cartel decided. The cartel indeed seemed to have owned the world. Yet the question that remains is that; are citizens of the OPEC states better off now than they were twenty- five years ago? In general terms, the answer is no because compared to the citizens of non-OPEC states, notably the West, citizens of the OPEC states are immeasurably worse off. Even in terms of specifics, there are still distinctions because within the OPEC states themselves, some are better off than the others. Things have been going wrong somewhere. It is against this background that I want to highlight some of the developments that have been happening in the oil industry of Nigeria, one of OPEC's member states.

Nigeria was not a founding member of the OPEC, it joined the bandwagon much later, even though at the time OPEC was formed, in 1960, oil had already been 'discovered' in the country. But at that time, the country had not yet caught the 'oil mania.' Besides, the pace of development of the petroleum economy in Nigeria was not being set by Nigerians but by Shell BP. Agriculture still accounted for most of the country's GDP.

Things changed, however, when Nigeria's military moved into the country's political scene. Under their leadership, Nigeria joined OPEC, neglected agriculture, and caught the oil mania following what came to be known as the 'oil boom'. And from then on, all the country's proposals and plans began to be based on certain assumptions about its oil. For instance, at independence in 1960, the total revenue of the Federal and regional governments combined amounted to no more than £143 million. Twenty years later, the expectation was that by 1981 the Federal government would derive, from oil alone, a revenue put at some £21 billion.

And the oil euphoria has continued. But the tragic thing about this is that, Nigeria has never at any one time understood the polemic intricacies of its oil industry. Even the Federal government had to come out to state its gross ignorance about the operations of the petroleum industry. In its second National Development Plan 1970-74, the government stated that: "The activities of the oil prospecting companies are so shrouded in secrecy that discussions of this important sector have always been in terms of generalities Any meaningful policy regarding the petroleum industry has therefore not been possible beyond broad guidelines

And with the ignorance of the government as a licence, petroleum ministers have often fed the nation with just woolly and speculative figures. It is thus the secrecy of the operation of the industry that has often led to mounting suspicions and belief by Nigerians over the years, that all has certainly not been well in the handling of this all important economy. This fermenting suspicion was to crystalise into certainty in the late seventies in the wake of what has now gone down in history as the "Oilgate" scandal.

Just as Nigeria's soldiers were marching back to their respective barracks in 1979 following the installation of a civilian government, a Lagos newspaper published an allegation that N2.8 billion had gone missing from the NNPC accounts while the soldiers were still packing their boots and khakis out of government houses. The news at first was a whisper, but with time, it became a snowball and grew bigger as it began to gather momentum. The final straw came in March 1980 when Dr Olusola Saraki, the Senate majority leader announced before the floor of the Senate that the missing money was alleged to have been paid into a private bank account in error.

With such a fresh life injected into Oilgate from above, President Shehu Shagari swiftly appointed a judicial tribunal headed by Supreme court judge Ayo Irikife to investigate the matter. But like most tribunals before it, this too became an exercise in futility. In the first place, the principal actors at the time the allegation was made Obasanjo, Buhari, Yar Adua, and Marinho, did not come out or were not called upon to testify.

Obasanjo who was later called to appear before the tribunal, refused, claiming some kind of immunity. Buhari who was the Petroleum boss at that time, and Marinho the NNPC chairman, simply sat put and refused to help the tribunal in its investigations. In the end, obviously to cool tempers after its blunders, the tribunal managed to vent its anger on Shell, Mobil and Gulf, hapless scapegoats of the real culprits, stating that these three oil organizations must hand over their oil share to the NNPC.

But that was not to be the end of Oilgate, for unknown to the culprits, a private investigative agency in the USA was contracted by some patriotic Nigerians with the blessing of the President, to dig out more on the allegation of the missing N2.8 billion.

The agency submitted its report in November 1983, a month before the military coup. In the report, part of Drums, the agency ascertained that in the past decade Nigeria had lost oil revenues of well over N10 billion through fraud and collusion between oil companies and petroleum ministers.

It also stated categorically that during the tenure in office of Mallam Muhammadu Buhari as Petroleum Minister and Festus Marinho as NNPC chairman, oil revenues worth over N6 billion simply disappeared or misappropriated or were as Nigerians would have it, paid into private accounts overseas. My high level sources also state that these documents and files containing the revelations were found in the State House, now Dodan Barracks, on the morning of January 1st 1984 just one day after the coup. Of course, it had not occurred to anybody then that Buhari would emerge as head of the military junta in Lagos. But as soon as Buhari assumed leadership as head of state, things started happening. The files containing those revelations disappeared and the first appointment Buhari made was to recall Festus Marinho and reinstate him as chairman of the NNPC. Now Tam David West, Petroleum Minister is hovering in midstream, obviously powerless against the gang of two. Buhari and Marinho are still Nigeria's oil Sheikhs.

Yahaya Dikko, Shagari's Petroleum Adviser, one who is regarded in the international oil community as having played and lived an impeccable, untainted, uncorrupted, and envious role in the oil market, is today being kept in prison, in Kirikiri. I am informed that his only crime is knowing, and possibly, being in possession of those damning and revealing documents. Interviewing Buhari recently, the Financial Times wrote that Buhari was selected by his fellow officers to head the new military government for three qualities in particular. One of those qualities according to the FT is "his experience as a former Petroleum Minister." Either that is a deliberate dramatic irony, or the greatest understatement of the year.

Further developments in Nigeria's oil industry are still unfolding. I will keep you posted if you keep a date.

talking drums 1985-03-11 rawlings brutalities at Gondar Barracks