Liberia: second oil grant from Japan on the way
By Peterking Quaye – Liberia Petroleum Refining Company (LPRC) has announced the importation of a second oil grant to Liberia by the government and people of Japan.
This was contained in a statement signed by LPRC Board of Directors, the statement further says that Japan had already written to authorities at the Ministry of Commerce informing government of the grant, The Board of Directors, the highest decision-making body of the company further disclosed that the grant is expected to arrive in Liberia this year.
At the time of purchase, the board said, the US$13 million allocated by the Japanese government was not sufficient to purchase 15,000 metric tons of mixed petroleum products due to the increase in the international petroleum price index.
Despite the accusation leveled against LPRC for the first grant project that is was not managed with the highest degree of transparency, professionalism and efficiency by the LPRC Board of Directors. The LPRC Board declared last week in a statement that on the contrary, The Government of Japan was so pleased with the management of the first grant that is why they contacted the Ministry of Commerce concerning a second grant to Liberia in 2012. The Board statement also stated that a total of 12,404.041 metric tonnes was delivered to LPRC by the Japanese Government in the first oil grant.
In the LPRC Statement, the board said the decision by the Japanese Government was triggered by the manner in which the first grant delivered to Liberia was managed.
The board also named the Government of Liberia, represented by the Ministry of Commerce, as consignee, and LPRC as custodian. They were the two government entities that were represented at the turning-over ceremony of the grant.
LPRC explained that upon the arrival of the grant into the country, a total of 12,404.041 metric tons provided was given to a local petroleum dealer, Aminata, who sold the oil on behalf of LPRC. The LPRC management stated that based on the Liberianization Policy, Aminata, representing a group of Liberian importers, was appointed as Trustee to market and distribute the products.
The Board asserted that said arrangement was approved by the Public Procurement Concession Commission (PPCC), based on a letter that was submitted by the Minister of Commerce. The said letter was part of the report prepared by LPRC and the Ministry of Commerce.
The Board further explained that Aminata sold said products to Monrovia Oil Trading Company (MOTC), Petro Trade and West Oil, and subsequently paid a total of US$839,268.40 to LPRC for storage and handling fees, an amount agreed to in the MOU representing 100 percent of the storage and handling fees due to LPRC from the Japanese Oil Grant arrangement.
Additionally, the company said Aminata deposited a total of US$8,504,177.50 into the escrow account opened at the Central Bank of Liberia. The government of Liberia, according to LPRC, was also paid $1,859,075.00 while the National Port Authority (NPA) was paid US$18,606.07 as port charges relating to the Japanese grant.
Crown Agent, representing the Japanese Government, was paid US$122,068.72 while the LPRC received only US$22,500.00 as administrative cost, the board said.
The LPRC management, however, mentioned that there were losses associated with the transaction such as evaporation, ship-to-shore and demurrage (compensation for loading or unloading delay), which are normal occurrences in the petroleum industry.
Said losses, the corporation said, were communicated to all stakeholders, and were absorbed by LPRC. The figures given by the corporation to date, however, do not account for the losses in numerical terms.
Meanwhile, the Board of directors has also reiterated its commitment to the government’s Liberianization Policy, evidenced by its providing 60 percent of all importation allocation to Liberian firms, while 40 percent is to be shared by international firms.
The LPRC Board insisted that Liberians must be empowered to take charge of their economy. The company did not however state when the product would arrive in the country.
