Fifteen years after the federal government introduced the electronic system of tracking and monitoring cargoes and other vessels along the Nigerian seas, the scheme is yet to fully take off, on account of high-level horse-trading, corruption scandals and rivalry between government ministries and agencies, Daily Trust on Sunday can report.

The system, if implemented, will allow the government to monitor incoming and outgoing ships through real time generation of advance information on ships involved in international voyages.

Aside the billions of naira that could accrue to the Nigerian government in revenue from cargo tracking on the country’s waters, which are currently missed, experts and senior government official have also raised concerns over the effect of the monitoring failure on national security and curtailing the menace of oil theft.

The initiative was first initiated by the US Department of Homeland Security in the aftermath of the 9/11 terror attacks as a preventive security measure.

The UN Security Council later mandated the International Maritime Organisation (IMO) to adopt it as a security framework for enhancing the protection of international shipping and prevention of movement of dangerous cargoes.

The move to put in place the tracking system in Nigeria had been thwarted at different times since the idea was first muted under the administration of former President Olusegun Obasanjo in 2004. Since that time, the scheme only worked for less than two years before it was halted at two different times.

Industry insiders attribute the dilly-dallies in the implementation to official corruption, fight over control and quest for cornering what is described as a lucrative job among contractors and top government officials.

Failed journey and web of corruption

In May 2007, the Federal Ministry of Transportation (FMOT) directed the Nigerian Ports Authority (NPA) to study a proposal prepared from a consortium, Ports Management System Company Limited (TPMS)-Antaser.

The TPMS, a company owned by a Beninese businessman, Jean Codo, had partnered a Belgian maritime firm, Antaser, to form the consortium.

With change of government later that month, the initiative was mired in bureaucratic bottlenecks, taking over two years before the Federal Executive Council (FEC) granted approval for the NPA to work with TPMS-Antaser for the implementation of the scheme.

Two sides signed on to a sharing formula of 60:40 in favour of the federal government.

The CTN, Daily Trust on Sunday gathered, attracted various sums, ranging from €150 to as much as €450, depending on the size and type of the cargo. The extra charges, however, attracted cries from shippers at the time.

After much agitation and complaints by industry stakeholders, including allegations of massive corruption, the scheme was brought to an abrupt end by the then Minister of Finance, Ngozi Okonjo-Iweala, on November 9, 2011.

Undeterred by the cancellation of the initial ideal, TPMS got another approval, which was curiously hastened up in the dying days of the President Goodluck Jonathan administration, with the president approving the contract just a day before he left office on May 28, 2015. This time, the TPMS was to work with the Nigerian Shippers Council (NSC) for the implementation.

In a copy of the submission made by the then Minister of Transport, Senator Idris A. Umar to President Jonathan, the minister said the ministry had obtained a No-Objection Certificate from the Bureau of Public Procurement (BPP) sequel to a May 11, 2015 approval by the president “for the resuscitation” of the scheme.

On June 4, 2015, the Ministry of Transport wrote the NSC, directing it to commence work with the TPMS as approved by the outgone administration. The two signed off a memorandum to that effect on July 30, 2015.

But with the corruption allegation from the 2010 contract bugging the company, the new deal did not go far as the Economic and Financial Crimes Commission (EFCC) launched probe.

In her book, Fighting Corruption is Dangerous: The Story Behind the Headlines, Okonjo-Iweala, who also chaired a presidential committee on ports reform, recalled how she came under fire for stance against the CTN project, which she said was used by unscrupulous government officials to siphon public funds.

“Clearly, the $6million from the Nigerian Ports Authority from the Cargo Tracking Note not being remitted to the treasury must be going into some influential pockets,” she wrote.

A reconciliation of the revenue collected from the scheme from the inception in March 2010 to the time it was halted in November 2011 showed that the sum of €16,692,642.20 was realised.

However, while the NPA was paid €10,015,585.32 and the company got €6,388,415.15, a total of €3,627,170.12 was unaccounted for. The EFCC report, submitted in 2018, indicted the TPMS and its managing director, Codo, for cornering parts of the proceeds of the scheme to the tune of €3,627,170.22

Also, Muhammed Habib Aliyu, who was the minister of state for transportation between 2005 and 2007, was named by the EFCC as “a promoter” of the controversial company.

Arising from the investigation, Codo and the TPMS were charged to a Lagos High Court by the EFCC in December 2019 over an alleged €29m fraud. Mr Codo was to die in prison on May 21, 2020 while awaiting trial.

Using the alibi of the corruption scandal and effusion of time on the five-year contract signed in 2015, the administration of President Muhammadu Buhari discontinued the relationship with the TPMS in 2020 on the advice of the Attorney-General of the Federation and Minister of Justice, Abubakar Malami.

Throughout the five years the new contract with the TPMS lasted (2015-2020), Daily Trust on Sunday gathered that there was virtually no activity carried as implementation was halted by the probe into the 2010 deal.

With the scandal around the TPMS and its subsequent exit from the scene, the salient scheme remained moribund, with one government document claiming that up to $2.5billion was lost in the 10-year interregnum since the first contract was cancelled.

Contract quest, Buhari’s approvals and power play

Official correspondences and other documents seen by Daily Trust on Sunday revealed how businessmen and top government functionaries fought to win the lucrative contract to exert their influence in the process leading to duplicated efforts and policy summersaults for the last 22 months.

With the TPMS out of the way, a private firm, Donnigton Nigeria Limited, wrote a proposal to President Buhari, through his chief of staff, Professor Ibrahim Gambari, for the re-introduction of the cargo tracking note service.

In the four-page letter dated January 19, 2021, the company reminded the Nigerian government of its international obligation to put the tracking system in place, as well as the loss in revenue due to its absence, while pledging to share proceed in 60 to 40 ratio in favour of the government if is appointed to serve as the consultant for the scheme.

The company later submitted a similar proposal to the Federal Ministry of Finance, Budget and Planning in a letter dated March 3, 2021. The promise to expand revenue based enticed the finance ministry, which invited the firm to a meeting on April 15, 2021 to get clarity about the proposal.

Coincidentally, the same day management of Donnigton wrote the finance ministry, the National Security Adviser (NSA), Major-General Babagana Monguno (retd), in separate letters to the then Minister of Transportation, Rotimi Amaechi, and managing directors of the NPA and the NSC, raised the alarm over the security implication of not having the cargo tracking system in place. In the letter, the NSA summoned the three senior government officials to a meeting, which never held as Amaechi did not honour the invitation.

While the Ministry of Finance was having its own discussions with the management of Donnington, the EFCC chairman, Abdulrasheed Bawa wrote to President Buhari, underscoring the importance of having the tracking scheme in place, especially to monitor crude oil vessels to checkmate the rising cases of oil theft and bunkering, which have deflated Nigeria’s much needed oil revenue.

The EFCC boss requested the president’s approval for the ministries of finance and petroleum resources to collaborate on the implementation. The prayers were granted by the president.

Bawa would subsequently communicate the presidential approvals to the ministries concerned.

Buhari’s chief of staff, Gambari, also wrote letters to the respective ministries, transmitting the presidential directive for the ministers to “immediately” work out the implementation.

This triggered another round of jostling for the contract, with ministries acting at cross purposes.

On August 19, 2021, Amaechi obtained an interim approval from President Buhari for the engagement of two companies, Medtech Scientific Limited and Rozi International Nigeria Limited as consultants for the cargo tracking contract. Amaechi’s action was believed to be in a bid to block any other ministry from getting control of the scheme.

With the presidential anticipatory approval, Amaechi wrote the BPP on September 11, 2020, seeking approval to conduct a restricted/selected tendering exercise to engage agents or partners for the implementation of the scheme.

It took three months before the BPP replied Amaechi, objecting to the move by the Federal Ministry of Transportation to Medtech Scientific Limited and Rozi International Nigeria Limited for the disregard of due process, lack of merit and absence of security clearance.

The BPP rejected the selective tender request and asked the transport ministry to conduct International Competitive Bidding (ICB) and obtain security clearance from the office of the NSA in view of the sensitive nature of the contract.

Around this time, the administration’s three senior officials – Gambari, Monguno and Amaechi – went on a collision course over the contract.

While this was on, the Ministry of Finance, which had gone on with its engagement of Donnington, on October 18, 2021, wrote the BPP, seeking issuance of Certificate of No-Objection to award the cargo tracking contract on “all Nigerian crude oil export” to the firm.

But in response to the ministry, the BPP denied the requested certificate on account of possible overlap and other inadequacies.

According to the letter signed by the BPP’s director-general, Mamman Ahmadu, the CTN proposed by Donnington through the finance ministry, “is similar to Internatonal Cargo Tracking Note (ICTN) scheme proposed by the Federal Ministry of Transportation,” adding that allowing the two “will be tantamount to duplication of services and may lead to loss of revenue to government.”

The bureau also reiterated the positions it raised in rejecting the submission of the Ministry of Transportation that “projects of this nature should be procured using International Competitive Bidding and not through Direct Procurement Method from an unsolicited proposal” and for the NSA’s office “to vet any contractor that will undertake such services.”

With the rejection from the BPP and aware of the ongoing process at the Ministry of Transportation, the Ministry of Finance, in a letter dated December 29, 2021, asked Donnington to re-channel its proposal to the transport ministry.

The power play, however, continued with a pushback from the Ministry of Petroleum Resources, which on January 7, 2022 wrote to the Attorney-General of the Federation (AGF) asking for validation of the president’s directive of May 4, 2021. Curiously, by January 11, the Minister of Justice wrote back validating the presidential approval and asking the Ministry of Petroleum Resources to proceed with the process, invoking national security nature of the contract to give backing to direct procurement rather than international competitive bidding as preferred by the BPP.

Backed by Malami’s validation, the petroleum ministry approached the BPP requesting for issuance of certificate of no-objection to enable it engage Donnington and its partner, Vortexa Limited (UK) as consultants to implement the scheme.

However, in its reply to the ministry on March 1, 2022, the BPP disagreed with Malami that the contract should be covered under national security. The bureau, however, agreed in principle to issue the certificate on the condition of providing additional details about the company and obtaining further documentations, including security vetting.

The ministry reverted to the BPP on March 17 with clarifications on some of the points raised by the bureau and asked that the certificate of no-objection be issued pending the security vetting, which it said was requested from the Department of State Services (DSS).

But checks by Daily Trust on Sunday show that the BPP was yet to respond to the ministry or issue the certificate as requested, as of the time of this report.

Presidency opens new window

Perhaps embarrassed by the too much rigmarole and lack of progress on the issue, the chief of staff to the president, on August 16, 2022, wrote ministers of justice, finance and transportation, communicating presidential directive for the Ministry of Transportation “to implement the CTN scheme in Nigeria based on extant procurement guidelines.”

He said the directive was after the presidency “carefully reviewed various submissions by relevant stakeholders on the matter.”

Gambari, who said the latest approval superseded others, also asked the minister of transportation to “shortlist between 3 and 5 firms to be appointed as agents” for approval of the Federal Executive Council at the end of the exercise.

The chief of staff wrote again on September 19, 2022, conveying the approval of the president to the minister of transportation for the adoption of the Direct Procurement Method to get a “reputable consortium to implement the scheme.”

Gambari’s last two letters, however, irked some of the interested parties, who viewed it as an attempt to hijack the process and illegally temper with it.

Like the previous implementation of the project, the procurement process is also riddled with allegations of corruption, with some of the parties involved alleging deliberate “dragging of the president into the matter” to justify what they described as illegality and injustice.

But government insiders argue that the presidency had to get involved to cut short the back-and-forth and conflict of interests on the matter, which had cost the country billions of naira.

Just like Okonjo-Iweala wrote in her book years ago, an industry insider told our reporter that “due to the immense level of corruption in the country, there are so many people who do not want the CTN to be implemented in a way that the revenues collected would go into individual bank accounts.”

According to the source, who spoke on the condition of anonymity, aside diversion of revenue, there is also the issue of under-declaration of cleared containers.

“If Ghana processes 12.6million container cargoes per annum with 3.5m from Tema port alone, how would Nigeria claim it processes only 1.5million per annum? Ghana has a population of 22million as against over 200million for Nigeria, so you can imagine what the actual would be if done well.”

Firm sues FG over diversion of tracking contract

Dissatisfied about the turn of events, Donnington Nigeria Ltd, in September sued the federal government over an alleged hijack of the contract for the tracking of petroleum products.

The company is asking a Federal High Court in Abuja to issue an injunction restraining the Federal Republic of Nigeria from engaging any other consultant, companies or persons for the implementation of the “Cargo Declaration, Cargo Tracking Note Scheme” to include crude oil exports for all import and export shipments within the Nigerian shipping industry.

Donnington joined the Attorney-General of the Federation, Ministry of Petroleum, Federal Ministry of Finance, and the Federal Ministry of Transportation as defendants in the suit.

In an originating summon by their counsel, Reuben Atabo, a Senior Advocate of Nigeria (SAN), the firm claims that following the chief of staff’s letter dated May 4, 2021, conveying the president’s approval for the re-introduction of the scheme and relevant approvals from the various ministries and agencies, it expended over $3million for the purchase of equipment and items, set up a portal at $370,000, engaged foreign partners from the United Kingdom, United Arab Emirates (UAE) and recruited staff through a human resource company.

The managing director of the company, Mohammed Sani, further avers that “After complying with all the requirements, the plaintiff/applicant (Donnington Nigeria Ltd) observed that the Ministry of Transportation was trying to introduce another company to render similar services.”

Daily Trust on Sunday gathered that the case is fixed for Friday, Novermber 4, for hearing.

Attempts to get reactions to this story from the Ministry of Transportation was not successful as spokespersons for the ministry and the minister did not get back to our reporter days after promising to give a feedback.

But a source at the Ministry of Transportation told our reporter that the ongoing process being conducted by the ministry had no relationship with previous processes that were aborted and would soon be completed to enable commencement of the scheme.

“The presidential approval is clear about it. The last directive from the president had taken over all that was in place previously and the ministry and the NPA are working assiduously to give it effect as soon as possible,” he said. (Daily Trust: Text, excluding headline)

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