Shady Oil Deal with Nigeria will affect Economy

Malawi’s State House has dragged the country into a crude oil contract with a Nigerian firm that could be costly for the already troubled economy, Weekend Nation reveals. At issue is the manner in which State House handled the contract given that this was a highly technical matter; the lack of a clear cost-benefit analysis for Malawi in the deal and the legal pitfalls government could find itself in at the closure of the one-year contract end this month. The government-to-government deal, signed between the Republic of Malawi and the State-owned Nigerian National Petroleum Corporation (NNPC) on May 16 2012, but which came into effect on May 1 last year; will expire on April 30 2013. According to a contract and correspondence on the deal, the transaction is two-pronged: (1) crude oil allocation from the Government of Nigeria through NNPC facilitated by an agent firm—Petroleos De Geneve SA Limited (PDG)—and (2) the supply of petroleum products to Malawi through the National Oil Company of Malawi (Nocma) by the agent firm.

Weekend Nation investigations show that to facilitate the deal, President Joyce Banda gave Michael Anyiam-Osigwe—who she had earlier appointed as Malawi’s Honorary Consul-General to Nigeria—authority to sign the multimillion dollar crude oil deal on behalf of Malawi, before involving relevant government technocrats. Weekend Nation found out that Anyiam-Osigwe—a member of one of Nigeria’s wealthiest families—went ahead and enlisted PDG—a company ran by his relation Raymond Anyiam-Osigwe—to act as the agent in return for some unspecified payment of royalties. Correspondence Weekend Nation has reviewed in the past weeks confirms the association that Anyiam-Osigwe has with PDG.

The investigations also established that State House only involved technocrats from the Ministry of Justice, Treasury, the Ministry of Energy and Nocma two months after Consul-General Anyiam-Osigwe had signed the contract on behalf of Malawi and when the deal was already in effect.

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