Oil deal debate rekindles other regimes' grand corruption cases

Integrity Centre where Ethics and Anti Corruption Commission office is located. November 24, 2023. [Wilberforce Okwiri, Standard]

Ongoing exchanges by politicians over another suspected mega scandal, this time involving oil imports rekindles many other shady deals that have rocked successive governments in the past.

Questions have been raised over the legality of the Sh17 billion diesel imported into the country last month after different parties lodged claims for the cargo.

Following the controversy, opposition leader Raila Odinga accused senior officers in the Ministry of Energy of profiteering after allegedly using Sh17 billion from the consolidated fund to purchase the fuel through agents and pocketing profit generated from the local retail market.

It also brought into question the government-to-government oil importation deal struck between Kenya, Saudi Arabia and the United Arab Emirates. 

“Can they show us the G to G contact and all the details of the contact between Kenya and the gulf countries,” asked Raila before President William Ruto responded that all transaction documents were available in parliament.

Makueni Senator Dan Maanzo backed Raila’s statement saying the former Prime Minister knows what he is talking about because of his long experience and knowledge of what happens in government.

Raila, who is the ODM party leader, has called for the immediate resignation of Energy Cabinet Secretary Davis Chirchir and his Treasury counterpart Njuguna Ndung’u.

He, who also asked the Ethics and Anti-Corruption Commission (EACC) and the Directorate of Criminal Investigations to investigate the diesel import, claims the G-to-G deal was signed and kept secret to drive up the cost of fuel in the country while benefiting certain government officials.

Raila also alleges that Kenya did not sign any agreement with the UAE or Saudi Arabia and that the deal was between the ministry of Energy and state-owned companies in the Middle East countries.

Neighbouring countries have also questioned the alleged G-to-G agreement between Kenya and the gulf states, arguing that it complicates their continued reliance on fuel imports from Kenya because they will incur huge loses to middlemen.

Daadab MP Farah Maalim, who once served as Deputy Speaker, has called for a transparent review of the disputed Sh17 billion import that was also claimed by businesswoman Anne Njeri.

The MP wants more clarity on the issue because he knows oil is always available at discounted rates.

“Oil is always available at multiple prices, whether in G-to-G or through private deals with other producers because of large amounts of surplus that is produced by Opec countries over and above their open fixed quota,” said Maalim.

He is aware Saudi Arabia produces about 13 million barrels daily, which is much more than the 10 million barrels of what is allowed in the Opec quota. That means they are always willing to strike private deals at a much more discounted prices with governments and private companies on the international market.

“It is unfortunate that instead of using that opportunity for the good of their people, politicians in Kenya have used that for personal benefits by lining up their pockets,” says Maalim.

He recounted how former Somali President strongman Siad Barre and the then President of Tanzania Julius Nyerere unselfishly used that avenue for the benefit of their countries unlike in Kenya where successive regimes continue ripping off their citizens.

Leaders like Barre and Nyerere, he argues, served because they cared for the people they led and the same happens in many countries across the world that are led by patriots who detest stealing from the public.

“In our case, it always about the political class, from independence when the Prime Minister (later president) Jomo Kenyatta became the biggest land owner and the practice has continued until today where successive presidents are the richest and even opposition leaders,” he says.

He says none of those leaders can boast of having any business that could generate the kind of wealth they possess and it is, therefore, anybody’s guess where those riches come from.

The MP quotes a Somali proverb, “You can never recover a camel that has been stolen by the owner”, to mean it is the owners of this country that loot it.

Allegations of mega scandals in the oil and petroleum sector in Kenya have been rife over the years which makes the ministry of Energy one of the most sought after dockets in power sharing deals.

Five years ago investigators opened another probe into what could have turned out to be the country’s biggest corruption scandal at the Kenya Pipeline Company (KPC) allegedly involving Sh95 billion.

It later emerged that the charges could have been exaggerated because as was argued in court, Sh95 million could probably not have been stolen in a company whose annual turnover had never gone beyond Sh28 billion.

It was also alleged that Sh40 billion had been lost in a project to build a new 450-Kilometre fuel pipeline between Mombasa and Nairobi and that another Sh1.9 billion for the construction for the Kisumu Oil Jetty project had been misappropriated.

Kenya Pipeline Company Managing Director Joe Sang and five former managers were all acquitted of those charges early last year in President Ruto’s administration. He was thereafter appointed by the President again to head KPC.

The oil regulating and distribution company was also in the news in 2012 when it was alleged it illegally bought land in Ngong Forest in 2001, a scandal that led to the suspension of then Cabinet Minister William Ruto.

The current president and four others faced fraud charges over the alleged sale of a piece of land in Ngong to KPC for Sh272 million. The then Minister for Higher Education allegedly received Sh96 million at various intervals during the alleged transaction.

President Ruto was acquitted of the land fraud charges in April 2011 for lack of evidence after the prosecution failed to produce in court the then Finance Manager Hellen Njue to give her evidence on how she paid out the money.

It has also been reported in the past how cartels have made big fortunes from millions of litres of fuel officials at the company claimed was lost through evaporation and pipe remnants. In 2020, the company suspended senior managers over claims it had lost 300,000 litres of fuel which had been recorded as pipeline loss.

 Maalim says shameless theft by politicians has encouraged the scourge to permeate through society including households and other institutions.

Major scandals in the country run from the Goldenberg scam in 1991 during President Moi’s rule which according to findings by the Goldenberg Commission of Inquiry cost the country up to Sh158 billon.

Since that shocking massive fiscal fraud that left the country bleeding, an avalanche of many more mega scandals followed relentlessly over the years and from the look of things, it appears many more will follow.

They have come in all sizes, with politicians involved in many scams both big and small, while stealing the limelight by walking scot free after dramatic court appearances in attempted but often shambolic prosecutions.

In May 2004, during President Mwai Kibaki’s administration, a suspicious Sh3.5 billion passport prining system procurement deal awarded to a UK company, Anglo Leasing, was exposed.

Shortly after, it emerged that the same company had also secretly tendered for another Sh4 billion Forensic Laboratory equipment contract for the DCI.

Ministers close to Kibaki like Kiraitu Murungi and Dr Chris Murungaru dismissed the fraud claims as “ a scandal that never was” before another bombshell of a fictitious Sh4 billion tender for the building of a navy ship emerged.

President Kibaki succumbed to pressure and removed longtime ally Murungaru from the security docket, replacing him with another close associate John Michuki.

Three permanent secretaries were also charged in court as Kibaki released new guidelines for the Cabinet, banning ministers from doing business in their own ministries.

Shortly after, Cabinet Ministers Daudi Mwiraria (Finance), George Saitoti (Education) and Kiraitu Murungi (Constitutional Affairs) were all asked to resigned by the president.

The Goldenberg Commission of Inquiry had earlier recommended the prosecution of Prof Saitoti, a former Vice President and minister for Finance.

Later in 2009, Kibaki’s administration was again hit with a Sh2 billion maize subsidy scandal that created a big rift between the then Agriculture minister Ruto and his ODM boss, then Prime Minister Raila.

Mega scandals also hit Kenya hard in President Uhuru Kenyatta’s reign when the country was reported to have lost over Sh13 billion to corruption deals in key state departments.

Money was allegedly stolen from the National Youth Service (Sh 10.5 billion), Kenya Pipeline (Sh2 billion), National Cereals Board (Sh1.9 billion), NHIF, Kenya Power (Sh470) million and other dirty deals at the ministry of Lands.  

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