Tuesday, March 20, 2007

The president has spoken

Of recent I had pondered why most people leave issues and take on the president, or even blame president for every issue. We all know the Vice President mismanaged his office, but instead of us to hold him responsible for his actions, we ended up blaming the president, saying at the same time that he is not also clean, and that he also gave anticipatory approvals for certain projects outside the PTDF mandates. Some people of recent even call for his impeachment for BREAKING THE LAW he swore to protect. I really found this very amusing. So the President is guilty for embarking on some project to benefit Nigerians compared with his VP that mismanaged his office.
In any case, for those who seek clarifications from the President, he has spoken, and the response was in reply to the Committee on the review of Senator Ndoma Egba committee report.
In his letter dated March 16, Obasanjo told the committee that every approval he made was only after he was satisfied that the mandate of PTDF accommodated it.
The President's response was in three main areas where the committee asked for his clarifications - approvals for the African Institute of Science and Technology (AIST), Abuja (aka) Nelson Mandela Institution (NMI), Computer for All Nigerians Initiative (CANI) and PTDF Approved Specific Projects
According to Obasanjo, “there is therefore no iota of truth in the wild allegation that the funds released were diverted to any purpose other than the specific projects approved for. I hope the Review Committee will be able to physically verify these projects and payments to debunk this irresponsible and false allegation.”
He explained that the guiding principle for all his actions in the PTDF matter from the 70s till now was the three key words found in the title of the PTDF legislation: Petroleum, Technology and Development.
The President said this entailed, "to his understanding", - "capacity building and local content development – two great issues on which the administration has endeavoured to make significant change and impact.”
Giving the genesis of the PTDF, he noted that the PTDF Act was promulgated by the General Yakubu Gowon Administration in 1973 for the purpose of building the capacity of Nigerians to be active participants in the then emerging oil and gas (petroleum) industry following the Arab Oil Embargo and subsequent quadrupling of oil prices by Organisation of Petroleum Exporting Countries (OPEC).
Stating that the Act clearly mandated the Federal Government to take whatever actions it deem necessary to ensure that Nigerians were educated, trained, and developed to be experts and key players in petroleum technology, the President said that what constituted ‘petroleum technology’ in 1973, and what it is today were two key issues for reflection as his government attempted to derive the intentions of the government that enacted the PTDF law for general application and utility not only for 1973, but for the 21st century.
Disclosing that he served the Gen Gowon government as a minister, he stated that those who enacted the PTDF Act could not have foreseen a tip of what was to happen in the petroleum technology field since the information revolution that began in the mid-1980s. These include the invention of IBM Personal Computer, the development of optical fibre, digital microwave and cellular technologies, deployment of low earth orbit satellite technology and the Internet – all in quick succession, which have had a profound impact on not only oil and gas education, training and capacity building, but on the way governments and businesses conduct their affairs. He said because of this, “a lot of changes in the scope and content of the fields of study leading to a career in petroleum technology have occurred with the rapid development of miniaturization and digital technologies that have brought down the cost of these telecommunication, computer and television technologies.”
The government’s funding of Information and Comm-unications Technology (ICT) projects, the President said, arose from its understanding of the role of ICT in capacity building, education and government as “a nation without these basic ICT facilities cannot develop or compete or compare to one with proper ICT facilities in the 21st century."
Hence, the PTDF funding of ICT, he explained, “generally can be justified to enhance development of the petroleum industry in Nigeria as well as other industries. No business, industry or government can compete in the increasingly integrating global economy without a robust, ubiquitous and accessible ICT infrastructure, tools and continuous training for its people.”
On the approval of $25 million for the Nelson Mandela Institute, a not-for-profit foundation established by African Academics teaching in Europe, America and Asia with the sole objective of establishing four world-class universities of technology in the continent, the President said, “within the AIST is the Gulf of Guinea Institute – G2i. This is intended to be the premier faculty of oil and gas technology to serve as center for excellence for education, training and capacity building in petroleum technology for the Gulf of Guinea region and indeed the African Continent. It is on the basis of the foregoing that PTDF was approached to intervene in the development of the G2i of the AIST. The intervention of USD 25 million was approved out of the USD 40 million requested."
The first AIST, he restated, was to be established in Tanzania, but with his intervention and involvement of former finance minister, Dr. Ngozi Okonjo-Iweala, NMI was persuaded to agree to locate the first AIST in the Abuja Technology Village.
Obasanjo noted that “the intervention of the PTDF is to build the G2i “for the purposes of training Nigerians to qualify as graduates, professionals, … in the fields of engineering, geology, science and management in the petroleum industry in Nigeria in the express words of Section 2 of the Act, and more particularly section 2(b) – "subsidies for training", and section 2©) – "endowments to faculties in Nigerian universities or institutions approved by the Minister,” he said. "It will be indeed a surprising interpretation of the Act to say that the intervention of PTDF in G2i is outside its mandate, in the light of the foregoing and clear express provisions of the statute,” he added.
Obasanjo may be unpopular, but, must we put all blames on his head? Ever ponder along this line?

1 comment:

twinstaiye said...

PRES/134 16 March 2007
The Chairman,
Senate Review Committee on the Petroleum
Technology Development Fund (PTDF),
National Assembly Complex,
Three Arms Zone,
Abuja.
REPORT ON THE PETROLEUM TECHNOLOGY
DEVELOPMENT FUND
I write to acknowledge your letter of invitation on the above named subject
availing me of the opportunity to respond and clarify some of the issues therein,
and I thank your Committee for such an opportunity.
Let me hasten to express my understanding, as I had operated the law in
the 70s and today, that the three key words to guide the operation of the law are
found in the title of the legislation: Petroleum, Technology and Development. In
today’s situation, I will put it this understanding to capacity building and local
content development – two great issues on which the Administration has
endeavoured to make significant change and impact.
Technology Capacity Building and the PTDF Act
In the wake of the Arab Oil Embargo and subsequent quadrupling of oil
prices by OPEC, the Petroleum Technology Development Fund (PTDF) Act was
promulgated by the Yakubu Gowon Administration in 1973 with the purpose of
building the capacity of Nigerians to be active participants in the then emerging
oil and gas (petroleum) industry.
The objects of the Act were clearly to take whatever actions necessary to
ensure that Nigerians are educated, trained, and developed to be experts and
key players in petroleum technology. But what constitutes ‘petroleum technology’
in 1973, and what is it today? These are key issues for reflection as we attempt
to derive the intentions of the government that enacted the PTDF law for general
application and utility not only for 1973, but for the 21st century. I was privileged
to have served that government as a Minister.
Petroleum Technology in 1973, Today and Tomorrow
Up until the 1990s when a few universities outside Nigeria began offering
degrees in Petroleum Engineering, petroleum technology as a field of academic,
professional or vocational study did not exist. The roadmap to a career in
petroleum technology is to acquire degrees or diplomas in any of the following
fields of study:
• Chemical Engineering and Industrial Chemistry
• Geology and Geophysics
• Basic Engineering – civil, electrical, mechanical, electronic, etc.
• Computer Science and Electronics,
• Physics and Engineering Physics, and
• Surveying and Remote Sensing
In those days, computer science and electronics were at their infancy.
Indeed, then ‘computers’ were huge mainframes that filled up constantly airconditioned
rooms that were not accessible to anyone but ‘operators’ to feed
punch cards and magnetic tapes. Telephones were analogue devices that were
fixed in one place, and often required manual operators to connect calls over
copper wires and huge microwave towers, from town-to-town, and country-tocountry.
The word “Internet” did not exist, optical fibre had not been invented.
Those who enacted the PTDF Act could not have foreseen a tip of what
was to happen in the Petroleum Technology field since the information revolution
that began in the mid-1980s. The invention of IBM Personal Computer, the
development of optical fibre, digital microwave and cellular technologies,
deployment of low earth orbit satellite technology and the Internet – all in quick
succession, have had a profound impact on not only oil and gas education,
training and capacity building, but on the way governments and businesses
conduct their affairs.
Today, a lot of changes in the scope and content of the fields of study
leading to a career in petroleum technology have occurred with the rapid
development of miniaturization and digital technologies that have brought down
the cost of these telecommunication, computer and television technologies.
Role of ICT in Capacity Building, Education and Government
Information and Communications Technologies (ICT) can contribute to
economic and human development. Nations around the world are eager to take
advantage of this potential. A nation without these basic ICT facilities cannot
develop or compete or compare to one with proper ICT facilities in the 21st
century. Hence, the PTDF funding of ICT generally can be justified to enhance
development of the petroleum industry in Nigeria as well as other industries.
The convergence of voice, video and data – the telephone (now mobile or
fixed), the television and digital information – carried over the same line –
whether wireless or via optical fibre has led to the emergence of ICT as the real
foundation of all knowledge, all business, all competitive advantage, whether in
reference to education, healthcare, industries and nations. No business, industry
or government can compete in the increasingly integrating global economy
without a robust, ubiquitous and accessible ICT infrastructure, tools and
continuous training for its people.
Today, ICT has become so pervasive in every sector, every industry and
economy that to imagine that it is possible to educate, train and build capacity in
petroleum technology or indeed any other field of the sciences and the
humanities without investing in its infrastructure and tools would be foolhardy,
even absurd. ICT investment today is akin to the investments in electric power,
roads, railways, airports, and seaports which facilitated domestic and
international trade, industrialization and growth of market economies in the 19th
and 20th centuries. ICT is today very much the pencil, pen and paper around
which the analogue workplace was built upon. It is impossible in the world of
today to realise the objects of the PTDF Act without substantial investment in
information and communications technologies, infrastructure, and tools.
African Institute of Science and Technology (AIST), Abuja
The Nelson Mandela Institution (NMI) is a not-for-profit foundation
established by African Academics teaching in Europe, America and Asia with the
sole objective of establishing four world-class universities of technology like the
famed MIT and the Indian Institute of Technology. Three prominent Nigerian
professors – Wole Soboyejo (Princeton), Tayo Akinwande (MIT) and Barth Nnaji
(Cornell) worked with the likes of the former President of Mozambique, Joachim
Chissano, Cyril Ramaphosa and Ngozi Okonjo-Iweala to promote the noble
objective and secure the backing of the World Bank, the Africa Development
Bank, the European Union and Blair Commission for Africa for the project.
The goal of the group of professors, technocrats and politicians is to
establish a technological university in each of East, West, South and North
Africa, in that order and each will be called the African Institute of Science and
Technology (AIST), but incorporated in each country of location as a stand-alone,
national and sub-regional, private university. The first AIST was to be
established in Tanzania, but with my intervention and involvement of Dr. Ngozi
Okonjo-Iweala, NMI was persuaded to agree to locate the first AIST in the Abuja
Technology Village.
The Federal Government of Nigeria through the FCT Administration
committed to providing 240 Hectares of land, infrastructure and financial support
to enable the early take off of the University by 2008. The AIST is to be cofinanced
by World Bank grants and credits, grants from the EU and the British
Government, and the African Development Bank. This provides Nigeria a unique
opportunity to have a world class technological university started on a clean slate
largely with subsidized funding from bilateral and multilateral development
partners. The FCT Administration requested and the NMI agreed to relocate its
head office from Washington, DC to Abuja in 2005.
Within the AIST is the Gulf of Guinea Institute – G2i. This is intended to be
the premier faculty of oil and gas technology to serve as center for excellence for
education, training and capacity building in petroleum technology for the Gulf of
Guinea region and indeed the African Continent. The Business and
Implementation Plan for the G2i are provided herewith as Annex I. It is on the
basis of the foregoing that PTDF was approached to intervene in the
development of the G2i of the AIST. The intervention of USD 25 million was
approved out of the USD 40 million requested.
The AIST is not a government-owned university and therefore does not
require an Act of the National Assembly to exist. It needs only to be incorporated
in Nigeria, and be licensed by the NUC to commence operation as a University.
AIST has already been incorporated as African University of Science and
Technology – Limited by Guarantee and its application to the NUC in process.
See Annex II for CAC Certificate of Incorporation. The Certificate of Occupancy
for AIST’s land has been issued, and architectural and engineering designs
completed. On 27th of February, 2007 I performed the groundbreaking ceremony
for the construction of the Gulf of Guinea Institute of AIST Abuja. Contracts for
the infrastructure are about to be awarded by the FCT Administration. In July
2007, the first set of participants in Executive Programmes in Oil and Gas will be
admitted to the AIST and degree programs are scheduled to start in 2008.
The Abuja Institute of Science & Technology (AIST) with its affiliate center,
the Gulf of Guinea Institute, will offer academic programmes and services in five
different areas;
i) Didactic and Training Services – which will offer postgraduate
programmes in academic disciplines that apply to the oil and gas sector,
ii) Economic Services – which would focus on the design, development and
publication of techno-economic indices on the costs of Oil and Gas resource
development in the Gulf of Guinea region,
iii) Engineering Research – which will offer research programmes specifically
on the construction and exploration problems on offshore drilling, production and
storage in the Gulf of Guinea,
iv) Socio-Ethical studies – which will concentrate on research on the impact
of oil and gas industry in the Gulf of Guinea region and other communities, and
v) Technical Publication to publish journals of international scholarly interest
in the oil and gas sector.
Being one of the largest oil producing countries in the world, this would
create a world class oil and gas industry training institution in Nigeria. Also it will
provide an alternative to training institutions outside Nigeria which currently trains
most of the public and private sector industry workers.
The intervention of the PTDF is to build the G2i “for the purposes of
training Nigerians to qualify as graduates, professionals, … in the fields of
engineering, geology, science and management in the petroleum industry in
Nigeria” in the express words of Section 2 of the Act, and more particularly
section 2(b) – ‘subsidies for training’, and section 2©) – ‘endowments to faculties
in Nigerian universities or institutions approved by the Minister’ . It will be indeed
a surprising interpretation of the Act to say that the intervention of PTDF in G2i is
outside its mandate, in the light of the foregoing and clear express provisions of
the statute. I attach as Annex III the process leading to the ultimate approval
when I became satisfied that the mandate of PTDF accommodates it.
Computer for All Nigerians Initiative (CANI)
The interpretation and application of any law related to any field of science
or technology, passed in 1973, without taking cognizance of developments in ICT
and impact on the education, training and capacity building will lead to absurd
results. In interpreting this law, looking at the narrow meaning of the literal words
of the Act are unhelpful. Interpretation must begin with deriving the intention of
the legislature.
The Federal Executive Council debated this extensively and concluded
that, and we accordingly submit here that the mischief the PTDF Act sought to
cure is the very low level of participation of Nigerians in the petroleum industry in
1973. It is impossible today for Nigerians in the Petroleum Industry in particular
and the Public Service in general to even communicate with the multinational oil
companies without ICT infrastructure, tools and training. The CANI was
introduced by the FGN to accelerate the bridging of the digital divide between the
public and private sectors of Nigeria on the one hand, and with the likes of Shell,
ExxonMobil and Chevron that are operating within our oil and gas industry and
communicating with civil servants in the cause of their daily operations. CANI
was conceived in furtherance of the government’s march towards e-government
for efficiency and global competitiveness.
The program enables public servants generally, including those in the
petroleum industry to acquire personal computers with Internet access and pay
over a long period. It is about building capacity in the public service in an
affordable manner for the greater good of the nation. These computers could be
used for accessing the World Wide Web (www) via the internet as explained
earlier. Public servants are encouraged to be computer literate by owning their
own computers including workers in the petroleum sector and students.
The chips from Intel and software from Microsoft are subsidized due to
volume commitments, and the computers are sourced exclusively from Nigerian
manufacturers, thereby contributing to local capacity building and utilization.
CANI is a form of subsidy to facilitate training and education for Nigerians
(section 2(b) of the Act). It is this interpretation of the PTDF Act that guided the
Federal Executive Council to approve the intervention of the PTDF in CANI, and
not any sinister insinuations.
Galaxy Backbone Plc
The clear need for a national ICT superhighway, similar to what other
nations have developed has already been made above as such infrastructure is
as basic to economic development and international competitiveness of Nigeria
today as the railways, power plants and roadways were to the industrial
revolutions in Europe and America. This Administration observed that Nigeria did
not have such an ICT backbone, but virtually every Ministry, Department and
Agency had completed, planned or ongoing ICT investment project. The News
Agency of Nigeria, NNPC, NEPA, Railways, NUC and others all had networks
based on satellite, optical fibre and digital microwave, alongside networks of
NITEL, —Tel and other private operators. Some state governments like Jigawa
State also had their own VSAT-based networks.
I observed that this duplication and waste needed to be curtailed, all our
ICT infrastructure development projects harmonized and streamlined. This
enabled standardization, consolidation and learning of experiences in ICT to
save money and reduce implementation costs. The Cabinet and Inter-Agency
Committees that studied the several projects recommended the establishment of
a public-private partnership with majority equity participation by the Federal
Government to create a National ICT Infrastructure Backbone (NICTIB) that all
governments, companies and individuals will tap into as our nation’s information
superhighway. This company is Galaxy Backbone Plc.
The network would be a shared resource for all arms of government
including all academic institutions such as: Petroleum Training Institutes, all
universities and colleges where potential oil industry manpower are being
trained. The availability of this backbone allows Nigerians access to information
on any subject of which the oil and gas is one of the most important.
Without such a national backbone, the basic foundation enabling rapid
education and training of Nigerians in petroleum technologies and indeed all
other sectors is non-existent. This has seriously hampered sector and national
development and the results are self-evident. This is the justification for the
intervention of the PTDF in the equity and debt stock of Galaxy Backbone Plc. It
is an investment which will not only help the nation achieve desired greatness,
the PTDF to fulfill its capacity building mandate, but provide reasonable returns
which section 1 of the Act alludes to, and Part III, sections 9 and 10 of the
Finance (Control and Management) Act 1958 allows. It is a very restrictive
interpretation of the PTDF Act that will lead to the conclusion that this
intervention is outside the mandate of the Fund.
In conclusion, technology development in modern times cannot be done in
isolation for one particular industry or sector alone. For example, the cost of
providing ICT infrastructure for say a geology department in a university would be
more or less the same for the whole university. Computer skills are readily
transferable in all industries, and therefore have multiplier effects in national
development. The development of the oil and gas industry through the PTDF
would therefore positively develop other sectors of the economy.
The desirability for the establishment and incorporation of Galaxy
Backbone Plc has been explained above. As for the cost of legal and advisory
services, the Attorney-General of the Federation as the chief law officer of the
Government is the one that handles and advises on all matters pertaining to
legal, judicial or documentation matters. When I received the bill for these
services from the Executive Secretary of the PTDF, I sought the Attorney-
General’s view. He considered that the cost was reasonable at N300 million
consistent with the scope of the advisory services, the professional charges
involving work of this nature, and the level of expertise required as well as the
standing of Counsel. In spite of that advice, I still reduced the charges by N50
million.
With my understanding stated and the explanations above, I will expect
the Review Committee not to regard the approvals as irregular but fully within the
mandate of the PTDF.
PTDF Approved Specific Projects
As stated in the memo from the Executive Secretary of the PTDF (Annex
IV), I approved the sum of N20 billion for various projects listed therein.
Disbursement is handled by the Accountant General of the Federation. I have
now confirmed that only N10 billion was released to the PTDF. And out of the
amount released, only about N4.6 billion have been paid to various contractors
for the projects as detailed in Annex IV. There is therefore no iota of truth in the
wild allegation that the funds released were diverted to any purpose other than
the specific projects approved for. I hope the Review Committee will be able to
physically verify these projects and payments to debunk this irresponsible and
false allegation.
DICON Rehabilitation Account
As to the issue of the release of N1 billion in the name of the DICON
Rehabilitation Account, I believe that the best way to react to the allegation
“using it for Mr. President’s vanity project” is to attach unabridged and unedited
the latest report of the Technical Committee on DICON which is quite selfexplanatory
for the Review Committee. See Annex V attached.
It is important to stress that the one billion Naira (N1 billion) was released
not only fabricate and produce replacement parts for the oil and gas industry but
to make Nigeria self-sufficient in small arms ammunition production by
September 2007, and in small arms production by September 2008. The total
amount expended so far is out of N1 billion released is N364,106,201.00.
Since the development of the indigenous assault rifle code-named OBJ-
006 was started in February 2006, months before my September 2006 visit and
the subsequent intervention of the PTDF, only N50,000 (Fifty Thousand Naira)
from DICON’s overhead cost was spent on the development of the rifle and
eleven prototypes. Code-name apart, DICON should be commended for the
initiative to produce a Nigerian assault rifle from local materials and expertise.
The Managing Director of DICON has suggested a visit by the Review
Committee or any other Committee of the Senate for that matter to DICON in
Kaduna. I will support the acceptance of the invitation for I was marvelously
informed and enlightened when I visited in September 2006.
Accept, Mr. Chairman, the assurances of my highest consideration.
OLUSEGUN OBASANJO

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