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Published On: Tue, Aug 26th, 2014

AGIP, GE defy NAPHIMS instructions with impunity (2)

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By Boniface Chizea

he poached members of staff of ARCO were placed to work side by side with ARCO staff and offered them emoluments and allowances far in excess of what ARCO was in a position to pay them.The company also went ahead to withdraw agreed overhaul/inspection allowances for ARCO staff. These two actions of GE resulted in wide disparity between the emoluments of the two groups of staff leading to unrest amongst the ARCO staff that refused to accept this unjustified disparity.

The matter was resolved by NAPIMS and GE had to increase the amount it was paying to ARCO to enable the company to adjust the salaries and allowances of its workers accordingly. GE, in reaction, made strenuous efforts to reduce the role of ARCO in the maintenance contract and in collusion with NAOC, outsourced part of ARCO’s scope of work to third party companies and at a stage pointedly requested NAPIMS to terminate the involvement of ARCO in the contract. NAPIMS however intervened, caused GE to return the jobs taken away from ARCO and blocked the attempt by both multinationals to abruptly remove ARCO from the contract.

When it dawned on GE that the attempt to destabilize ARCO was not a walk in the park, it turned around pretending to now want to work with ARCO to bid for a new 4+1 years maintenance service contract in December, 2011 only to delay and foot drag. When GE thought that ARCO has been schemed out as the deadline for the submission of the bids was near, it submitted a bid with another Nigerian Company. And despite the antics of GE to oust ARCO from the maintenance contract, the local content authority put a spanner in the works by duly informing NAOC via a letter dated May 16, 2013 that GE was not qualified to bid for continued participation in the maintenance contract. When this information was brought to the attention of GE it procured a Nigerian company as a lead (front) with GE as technical partner. Of course, ARCO in alliance with another equipment manufacturer sent in its own bid documents.

Meanwhile upon the expiration of the maintenance contract pending the approval by NNPC Board of a new 4+1 years contract, GE and ARCO were invited to submit their prices for a stop-gap contract for one year because they are the contractors on site. After protracted negotiations, both parties could not reach agreement on the terms of working relationship for the one-year stop-gap contract. NAPIMS subsequently requested GE and ARCO to independently submit their bids which was won by ARCO. So, NAPIMS asked NAOC to hand over the gas plant to ARCO for maintenance for six months. But NAOC continued to resist the directive that the contract should be awarded to ARCO while making efforts to award it instead to a different Nigerian based Italian managed company, Plantgeria Co. Ltd claiming that Plantgeria which has no proven experience, has been selected as the winner of the new 4 + 1 maintenance contract of the gas plants in an inconclusive tender process.

NAOC predicated its recommendation on Plantgeria’s almost give away price which is about 10% of the current cost of executing the same contract by GE. It underscores the fact that Plantgeria lacks technical depth in this matter and will not be able to deliver. It becomes obvious that GE will eventually be invited to take over the maintenance contract when Plantgeria fails because of the alleged existence of an offshore maintenance agreement between GE and AGIP/ENI which is against Nigerian Local Content Law. The bottomline is that NAOC and GE plans to oust ARCO from the gas plants.

It is interesting to note that NAOC’s recommendation has not been approved by the relevant authorities and yet Plantgeria is being pushed by NAOC to take over the stop-gap contract. This scheming is all to the effect to exclude and deny involvement to a competent indigenous company, ARCO that has long established its bona fides in the country’s economy. Even the Unions in the sector – PENGASSAN and NUPENG in particular are dead against Plantgeria because of its rumored anti-labor orientation and have jointly sent a letter to the Minister of Labor and Productivity threatening fire and brimstone should the company be engaged.

Notice has been sent to ARCO terminating its services with an effective date of June 30, 2014 with a demobilization period from July 1 to August 31, 2014. Since this notice, agents of Plantgeria Co. Ltd. have shown up on site with the information that they are the new contractors approved for the stop-gap contract. NAOC had to extend the termination date by one month because, from available information, Plantgeria has not been able to lure ARCO Engineers and Technicians to their fold. If we may ask, could it be that NAOC and GE are scheming to wreck ARCO and begin another long journey of raising an inexperienced company to enable GE keep its hold on the job through the backdoor?

It is necessary for the relevant authorities to step in to stop this brazen impunity and protect ARCO a wholly owned, patriotic Nigerian company which in all respects, has paid its dues from suffering this type of injustice in 21st century Nigeria. The Jonathan administration, as it embarks on its far reaching transformation agenda, should not allow this unfairness, this injustice to persist without its intervention to ensure that justice is not only done but seen to be done.

Dr. Boniface Chizea is CEO, BIC Consultancy Services, Lagos

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