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Fraud Allegation Rocks Nigeria’s LPG Sub-sector

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  • Fraud Allegation Rocks Nigeria’s LPG Sub-sector

The Nigeria Liquefied Petroleum Gas Association (NLPGA) is fighting an integrity battle to regain the confidence of its global body – World LPGA, the government and the public.

This is coming after its planned fifth Africa LPG Summit 2018 scheduled for June 19 and 20 in Lagos failed as a result of alleged misappropriation of funds set aside for the summit.

The botched summit would have been the first in Nigeria as the first and second summits were successfully held in Nairobi, Kenya in 2014 and 2015, the third in Tanzania in 2016, the fourth in Johannesburg, South Africa last year and the fifth in Nigeria but which eventually flopped.

At a fact-finding stakeholders’ meeting in Lagos to discuss the issue, the members noted that there is a huge reputation challenge before them, which requires urgent solution.

According to a report on the failed Africa LPG Summit, members of NLPGA stated that the Association broached the idea of hosting the summit in Nigeria after South Africa and mandated the Executive Secretary of NLPGA, Mr. Joseph Eromosele to drive the planning and work with the acting Director of the LPG summit, Vincent Choy. Eromosele was supposed to arrange visas for those coming from outside Nigeria as well as make arrangements for the speakers, pecial guests of honour, accommodations, exhibition and conference spaces.

Unfortunately, the money paid by member-companies and affiliates of NLPGA for the venue, hotel accommodation of some VIPs, as well as cash transferred to Eromosele were allegedly diverted by him.

NLPGA Deputy President, Mr. Felix Ekundayo, told the LPG stakeholders that the association discovered the fraud committed by Eromosele when the intending participants who paid could not access their bookings online and reported to the association’s executive.

Ekundayo said the executives of the association at various meetings asked Eromosele about the summit, but he was always coming up with excuses. “When we heard about the issue, we constituted an emergency meeting. Eromosele was immediately cut off from all communications and all the platforms of the NLPGA, and sent out disclaimers,” he said.

He noted that Eromosele had been suspended, and the case reported to the police, adding that the Special Fraud Unit of the Police would take up the investigation after required processes are completed.

This was also confirmed by other top officials of the NLPGA. Ekundayo further said $11,000 has been recovered from Eromosele so far.

According to the report available, the organisers of the Africa LPG Summit, All Events Group Pte Limited, was working with Eromosele through Vincent Choy, who collected and transferred the money to Eromosele.

The report also said Eromosele advised intending foreign participants to apply for a visa on arrival (VoA) and that they should submit applications of over 70 participants. “Up to the day of our flight, the 15th June 2018, the letter of approval for the visas was not issued and we were forced to cancel our flight.

“We advised all the participants who had been relying on NLPGA to organise the VoA that they were not now going to be available, and we had no option but to cancel the event.

“All the other exhibitors and speakers who were asked to apply for their own visas because they submitted their applications late were able to obtain their visas,” the report quoted the intending foreign participants as saying.

The report also said the organisers noted that NLPGA President, Mr. Nuhu Yakubu, was unaware that the association had been working with them as a co-organiser.

The report said: “The VIPs, including the Minister of State for Petroleum Resources whom Eromosele, has confirmed and asked us to pay for his accommodation, had no knowledge that the event was taking place.

“Several other speakers who were confirmed by Eromosele to be on the agenda were also unaware they were on the agenda. We highly suspect that the executive secretary of the NLPGA was acting alone and that the visas were not submitted properly to the immigration office and all the planning for the event we thought was in place, had not been done.

“As a result, we were forced to cancel/postpone the event and suffer significant costs and claims from exhibitors for cancelled flights and other costs because they had been unable to travel.

“Also, the funds which have already been transferred to Eromosele, the executive secretary of the NLPGA, are at this moment unaccounted for,” the report added.

The vice president, eminent industry chiefs, such as the Minister of State for Petroleum Resources and the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), among others, said they were unaware of the summit, with all the loopholes in the planning, the summit was cancelled.

The participants at the stakeholders’ meeting were not convinced by the presentations of the NLPGA executives, noting that they have failed for allowing an employee of the Association to drag its name and integrity in the mud nationally and internationally.

The stakeholders agreed on setting up a five-man committee cutting across all the segments of the LPG sub-sector.They include Mr. Gbenga Falusi, Chairman, Jacob Wale Coker, Mr. George Ebubechukwu and Mr. Monday Nwatu.

It was learnt that the money allegedly misappropriated by Eromosele ran into tens of millions of naira and the Singaporean, Choy, who was working with him to facilitate the participation of foreigners at the summit, according to the stakeholders, was naïve to have placed his trust on just one individual (Eromosele) for the event. With multiple red flags happening throughout the organisation of the event, more due diligence should have been conducted and further clarification sought from the association.

Choy has resigned as a result of the fraudulent transactions.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Crude Oil

Oil Dips Below $62 in New York Though Banks Say Rally Can Extend

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Oil Dips Below $62 in New York Though Banks Say Rally Can Extend

Oil retreated from an earlier rally with investment banks and traders predicting the market can go significantly higher in the months to come.

Futures in New York pared much of an earlier increase to $63 a barrel as the dollar climbed and equities slipped. Bank of America said prices could reach $70 at some point this year, while Socar Trading SA sees global benchmark Brent hitting $80 a barrel before the end of the year as the glut of inventories built up during the Covid-19 pandemic is drained by the summer.

The loss of oil output after the big freeze in the U.S. should help the market firm as much of the world emerges from lockdowns, according to Trafigura Group. Inventory data due later Tuesday from the American Petroleum Institute and more from the Energy Department on Wednesday will shed more light on how the Texas freeze disrupted U.S. oil supply last week.

Oil has surged this year after Saudi Arabia pledged to unilaterally cut 1 million barrels a day in February and March, with Goldman Sachs Group Inc. predicting the rally will accelerate as demand outpaces global supply. Russia and Riyadh, however, will next week once again head into an OPEC+ meeting with differing opinions about adding more crude to the market.

“The freeze in the U.S. has proved supportive as production was cut,” said Hans van Cleef, senior energy economist at ABN Amro. “We still expect that Russia will push for a significant rise in production,” which could soon weigh on prices, he said.

PRICES

  • West Texas Intermediate for April fell 27 cents to $61.43 a barrel at 9:20 a.m. New York time
  • Brent for April settlement fell 8 cents to $65.16

Brent’s prompt timespread firmed in a bullish backwardation structure to the widest in more than a year. The gap rose above $1 a barrel on Tuesday before easing to 87 cents. That compares with 25 cents at the start of the month.

JPMorgan Chase & Co. and oil trader Vitol Group shot down talk of a new oil supercycle, though they said a lack of supply response will keep prices for crude prices firm in the short term.

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Crude Oil

Oil Prices Rise With Storm-hit U.S. Output Set for Slow Return

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Crude oil

Oil Prices Rise With Storm-hit U.S. Output Set for Slow Return

Oil prices rose on Monday as the slow return of U.S. crude output cut by frigid conditions served as a reminder of the tight supply situation, just as demand recovers from the depths of the COVID-19 pandemic.

Brent crude was up $1.38, or 2.2%, at $64.29 per barrel. West Texas Intermediate gained $1.38, or 2.33%, to trade at $60.62 per barrel.

Abnormally cold weather in Texas and the Plains states forced the shutdown of up to 4 million barrels per day (bpd) of crude production along with 21 billion cubic feet of natural gas output, analysts estimated.

Shale oil producers in the region could take at least two weeks to restart the more than 2 million barrels per day (bpd) of crude output affected, sources said, as frozen pipes and power supply interruptions slow their recovery.

“With three-quarters of fracking crews standing down, the likelihood of a fast resumption is low,” ANZ Research said in a note.

For the first time since November, U.S. drilling companies cut the number of oil rigs operating due to the cold and snow enveloping Texas, New Mexico and other energy-producing centres.

OPEC+ oil producers are set to meet on March 4, with sources saying the group is likely to ease curbs on supply after April given a recovery in prices, although any increase in output will likely be modest given lingering uncertainty over the pandemic.

“Saudi Arabia is eager to pursue yet higher prices in order to cover its social break-even expenses at around $80 a barrel while Russia is strongly focused on unwinding current cuts and getting back to normal production,” said SEB chief commodity analyst Bjarne Schieldrop.

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Crude Oil

Crude Oil Rose Above $65 Per Barrel as US Production Drop Due to Texas Weather

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oil

Crude Oil Rose Above $65 Per Barrel as US Production Drop Due to Texas Weather

Oil prices rose to $65.47 per barrel on Thursday as crude oil production dropped in the US due to frigid Texas weather.

The unusual weather has left millions in the dark and forced oil producers to shut down production. According to reports, at least the winter blast has claimed 24 lives.

Brent crude oil gained $2 to $65.47 on Thursday morning before pulling back to $64.62 per barrel around 11:00 am Nigerian time.

U.S. West Texas Intermediate (WTI) crude rose 2.3 percent to settle at $61.74 per barrel.

“This has just sent us to the next level,” said Bob Yawger, director of energy futures at Mizuho in New York. “Crude oil WTI will probably max out somewhere pretty close to $65.65, refinery utilization rate will probably slide to somewhere around 76%,” Yawger said.

However, the report that Saudi Arabia plans to increase production in the coming months weighed on crude oil as it can be seen in the chart below.

Prince Abdulaziz bin Salman, Saudi Arabian Energy Minister, warned that it was too early to declare victory against the COVID-19 virus and that oil producers must remain “extremely cautious”.

“We are in a much better place than we were a year ago, but I must warn, once again, against complacency. The uncertainty is very high, and we have to be extremely cautious,” he told an energy industry event.

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