BNGS Old Boys Association set to sue NLNG, Daewoo, others over Train 7

The expected takeoff of the $4billion Nigerian Liquefied Natural Gas, NLNG, Train 7 project might suffer huge setback if necessary actions are not taken to address issues bothering on the implementation of the local content parameters in compliance to Nigeria’s extant regulations predicated in the Nigerian Oil and Gas Industry Content Development (NOGICD) Act. While Engineering, Procurement and Construction designs are currently ongoing, which when completed would upscale the production capacity of the Nigerian LNG plant in Bonny from 22 million MPTA to around 30 million MPTA.

Irked by the disregard for the implementation of the local content parameters in compliance to Nigeria’s extant regulations predicated in the Nigerian Oil and Gas Industry Content Development (NOGICD) Act, the Bonny National Grammar School (BNGS) Old Boys Association, through the Chairman of its Board of Trustees, Clinton Dan-Jumbo, has threatened to take the Nigeria Liquefied Natural Gas (NLNG), The Bonny Kingdom Local Content Committee (BKLCCC) and SCD JV to court if they do not reverse the decision to include non-Bonny contractors in the Bonny contract quota for the Nigeria LNG Train 7 Project.

Dan-Jumbo said: “As Chairman of the Board of Trustees of the BNGS Old Boys Association, and an international lawyer, although, I’m held back here in the United Kingdom due to the Covid-19 pandemic that has made international travel impossible, I have already instructed one of my four law offices in Nigeria to commence legal action against the trio if they fail to remove non-Bonny companies from the list of Bonny companies billed to take the 30% community content in the Train 7 project.

“The breezy effrontery with which these organizations operate with blatant disregard for the Bonny people is just repulsive. How can the Federal Government make a law to protect host communities and a company operating in the community will connive with a few persons in the community to deprive the people of their entitlement? This is pure evil and must not go unchallenged. I am ready to take this matter all the way to the Supreme Court, if need be. The law is clear on this matter and we have to use NLNG and all those involved in this evil to test the law, so that other companies will learn to obey the law.

“Sections 25, 26, 27 and 28 (2) of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act “mandates participation of host community entrepreneurs in the contractual commercial activities of the promoter, operators and contractors throughout the project life cycle”. The Community Content Guideline, however, goes on to state that: “The President of the Federal Republic of Nigeria launched the Petroleum Industry Roadmap on 27th October, 2016 to revitalize the oil and gas industry. A Key Performance indicator in the roadmap is to “Deploy 30% of business opportunities from operating companies to communities”.

“I specialize in Commercial and Maritime Law and I studied for my Master’s degree in a very highly rated British University in this area of Law, so no one can pull a wool over my eyes on this matter. What the NOGICD Act and the Community Content Guidelines are saying is that 1) For the NLNG Train 7, 30% of business opportunities belong to Bonny people 2) That, apart from this 30% of the NLNG Train 7, that must go to the Bonny people, any company coming to do business in Bonny, whether or not it relates to NLNG Train 7, must maintain a level of presence in Bonny and again provide 30% of business opportunities to Bonny people. In order words, if a company is coming from any part of the world including Nigeria to do business in Bonny, the Bonny people have a right to tell the company to have an office in Bonny and to give 30% business opportunity of the value of his contract to Bonny people.

“Since this is the law, I am surprised that non-Bonny contractors, the law says should give out 30% of their own contract to Bonny people, went into an arrangement with NLNG, SCD JV and three or four Bonny people who call themselves BKLCCC to collect the Train 7 NLNG 30% that belongs to Bonny people in exchange for 23% profit payment at the end of the contract. They are not even talking about the 30% the law says they must give to Bonny people should they win a contract from SCD JV, but are focused on how they will collect the 30% belonging to Bonny people from the Train 7 project, adding that to their own 70%. Interestingly, it was also agreed that the contract will not be awarded in the name of the Bonny contractors, but in the names of the non-Bonny companies, meaning Purchase Orders (POs) and Project Completion certificates will be in the name of the non-Bonny company who have a right to bring their workforce from anywhere, denying Bonny youths employment opportunities that were naturally theirs in the first place”.

He further advised the non-Bonny companies to stick to the contracts awarded under the 70% quota. Noting that ” if they wish to participate in the Bonny 30%, they should either make Bonny people directors in their companies or enter into joint venture agreements with the Bonny companies so that the Bonny people in the non-Bonny companies either as directors or JV partners can guarantee and protect employment opportunities for Bonny youths and, even, have purchase orders (POs) and job completion certificates in their companies’ names,” he said