For Okungu, corruption barons proved too strong

By John Njiraini

When in 2006, Kenya Pipeline Company (KPC) was ranked the second best performing State corporation, one man stood tall for achieving what many then deemed impossible.

Mr George Okungu, the immediate former KPC Managing Director, had ‘magically’ overcome all odds to transform one of the most corrupt, inefficient and lethargic parastatals to a profitable and dependable institution.

That this was achieved in the shortest duration possible made him admirable even to his harshest critics.

While receiving the award at the Kenyatta International Conference Centre, Nairobi, on December 8, 2006, in front of Government officials, donors and private sector dignitaries, Okungu did not mince words. The achievement was a result of hard work, sacrifices and commitment to excellence.

"Our focus has been running a healthy core business, adherence to strict and transparent procurement procedures and budgetary controls, financial management and cost containment measures and various management reforms and innovations geared towards efficiency and profitability," he said then.

Today, though, the words must being echoing in his mind as a painful reminder of how things have gone full circle at KPC. The company has not only fallen back to position 31 in the parastatal rankings of 2007, but it is also back to its old era of dubious and shoddy deal cutting.

Former Kenya Pipeline Company MD George Okungu. His office was linked to scandal that rocked the oil industry. Photo: Stafford Ondego/Standard

On his part, Okungu, who during his four-year reign at Kenpipe Plaza has weathered many storms, and gallantly fought many battles, joins the rank and file of former KPC bosses forced out of office, due to allegations of corruption. "This was purely fraud, and that is why we have ordered thorough investigations to be carried out," said Energy Minister Kiraitu Murungi last week, after it emerged the Government was on the verge of losing Sh7.6 billion in a mega oil scandal involving KPC and Triton Petroleum.

The scandal, which saw KPC officials release 126 million litres of oil to Triton in a well crafted scheme that may have cost key financers, including Kenya Commercial Bank (KCB) millions of shillings, came at a heavy price fo Okungu, KPC Chairman James Kenani and Operations Manager Peter Mecha.

To most people, the sacking of Okungu ended the colourful, and sometimes controversial career of a man many considered as the most effective the parastatal had in its 25-year history.

Disbelief

But to the few who knew and associated with him, questions still linger over how the former long-serving banker got his good name dragged into waht is increasingly looking like a tangled web of graft and fraud.

Granted, heading KPC is not for the faint-hearted, and Okungu knew it was never going to be easy when he ascended to the top after being the deputy MD since 2001.

Since its establishment in 1973, KPC had been a cash cow for politicians and well connected individuals. That the perpetrators would put up a spirited fight against anyone standing on their way was never in doubt.

"For many years, looting was the culture at KPC. I came in with a commitment to plug the leaks and streamline the company," said Okungu sometime in 2007.

With his predecessor and former MP, Shem Ochuodho, having been edged out due to an ill-conceived debt financing deal with Triple-A-Capital, Okungu assumed leadership at a time when KPC was at a crossroads. Apart from the rampant looting, political interference, cronyism and nepotism that were considered the norm, the corporation was indebted to the tune of Sh5 billion in unpaid taxes and penalties.

Besides, a headquarters building that was all but in name a white elephant was standing half completed and was a constant reminder of rot at the company.

Most critical though was the negligence of its oil distribution infrastructure that was not coping with the rising demand in the country and regionally.

Transformation

Having been an insider Okungu, hit the ground running in transforming the corporation, which is one of the most strategic installations.

For starters, he cleaned the internal systems that were bleeding cash, entered into an agreement with the Kenya Revenue Authority on how to clear the tax debts and took a major gamble of completing the headquarters whose final cost was a staggering Sh1.5 billion despite the original cost having been Sh573 million. But as is wont to happen, the corruption cartels that he was dismantling were not going to go without a fight.

As a result, Okungu found himself facing charges of abuse of office and corruption and the Kenya Anti-Corruption Authority (Kacc) dragged him to court and confiscated his passport ostensibly to ensure he did not slip out of the country.

According to Kacc, Okungu was to help cast light on the origin of irregular tenders worth Sh500 million for supply of furniture for the headquarters, spare parts and security contracts.

He may have ben saved from further embarassment by the fact that KPC was standing on a strong financial footing, with a clean balance sheet — Sh2.1 billion as pre-profits in 2006, a Sh150 million cheque to the Government in dividends and was enroute to being ranked as a top performing state corporation.

Whether the achievements were exceedingly overwhelming for Okungu, or whether they got to his head is a matter of conjecture because soon things started going awfully wrong.

Survival

Though, like the proverbial cat with nine lives, Okungu could have survived after Energy PS Patrick Nyoike vehemently defended him, his ultimate downfall was caused by oil marketer Triton.

As auditors seek to unravel the mystery of how KPC managed to release 126 million litres of petroleum to Triton without the approval of financers, questions abound on how Triton apparently managed to manipulate KPC officials, and why the small marketer, with a four per cent market share, was allowed to hold products for speculative purposes.

For Okungu, though, the sacking brings to an end the career of a man who valiantly tried to dismantle the cartels of graft at KPC, only for them to reel him into their murky world.

 

 

 

 

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