Egina FPSO: Group Demands Investigation Of Alleged Underhand Dealings, Local Content Violations

Share this:

Egina FPSO: Group Demands Investigation Of Alleged Underhand Dealings, Local Content Violations

Egina Plant

A group of Nigerians has called on President Muhammadu Buhari to urgently order an investigation into an alleged underhand dealings and violation of Local Content Law, that characterized the award of contract for the fabrication and integration of Egina Floating Production Storage Offloading (FPSO) facility to Samsung Heavy Industries (SHI).

In a letter to the President signed by Mr. Moses Siasia, Chairman of Nigerian Young Professionals Forum, NYPF, and Hamzat Lawal, Chief Executive of Connected Development, CODE, the group insisted that the process of awarding the contract was allegedly fraudulent.

The letter reads in part: “While it is not the first FPSO deployed in Nigeria, the Egina FPSO is the largest FPSO and the first to be fabricated and integrated locally in Nigeria and indeed in Africa. Naturally, the economic benefits of the local fabrication and integration of the Egina FPSO within Nigeria’s shores would have been significant, including local capacity development, job creation through the deepening of the participation of Nigerians in the oil and gas industry, facilitating local industrial development and ensuring that the execution of large components for the project was domiciled in Nigeria.

This would be in tandem with the nation’s local content laws i.e. the Nigerian Oil and Gas Industry Content Development Act 2010 and in fact Your Excellency’s presidential directive in the promulgation of Executive Order No. 5.

“As events have unfolded over the years, however, it is clear that the Samsung Heavy Industries (SHI’s) engineering, procurement, and construction of the Egina FPSO have been a sham calculated to massively defraud the Nigerian commonwealth, undermine the extant laws and signal corporate corruption of monumental proportions in the highest corridors.”

The petition highlighted some aspects of the contract believed to have violated existing laws, noting that actions were taken to win contracts regardless of the fact that Hyundai Heavy Industries (HHI) was the lowest bidder.

The group demanded that the President through the relevant office ensures that a thorough investigation is carried out so as to expose the irregularities surrounding Samsung Heavy Industries (SHI) and Samsung Korea, and their involvement in the Egina FPSO Project.

It further demanded that Samsung Heavy Industries Korea is given the maximum fine applicable for local content violations that are 5% of their contract sum.

In addition, it urged the President to stop the company from bidding for projects for 10 years in order to encourage honest contractors to come to Nigeria.

In addition, the letter called on the government to ensure that local content in the Egina FPSO Contract is fully implemented, which will include employment of Nigerian youths and or compensation to those not employed; building of a training school and restoration of majority ownership of the Shipyard in LADOL by LADOL which Samsung Heavy Industries (SHI) had attempted to dislodge as its local content partner.

Share this:

Leave a comment

Your email address will not be published. Required fields are marked *