Monrovia – Liberian President George Manneh Weah has ordered his Minister of Justice Cllr. Frank Musa Dean to report to him within two weeks with a finding into the explosive report by the London-based watchdog group Global Witness alleging that the U.S. petroleum giant Exxon 2013 purchase of Liberia’s Block 13 oil license likely enriched former government officials who may have illegally owned the block.
Report by Rodney D. Sieh, [email protected]
The report also alleges that the oil company made unusual, large payments to senior government officials who authorized the 2013 deal.
A FrontPageAfrica investigation has however spotted a potential monkey wrench in the quest of the Weah-led government to get to the bottom of the controversy with the designated head of the probe, Cllr. Dean at the center of a conflict of interest quagmire.
Several Oil Blocks Under Dean’s Watch
Cllr. Dean was Head of the National Oil Company of Liberia during the first bid round in 2004.
It was under Cllr. Dean’s tenure that the initial block was tentatively awarded, raising serious issues likely to thwart the two-week deadline ordered by the President.
In addition to Oil Block 13, Cllr. Dean also oversaw the negotiations of Repsol Block 17, Oranto Block 12, 16, 15, 13, 11, 9 & 8.
Global Witness has urged the Weah administration to look into the matter and the administration has obliged.
In a statement signed by Information Minister Lenn Eugene Nagbe Saturday, the administration said it is in receipt of information from several international groups including Global Witness and Wall Street Journal alleging grave acts of corruption on the part of several former government officials relating to the sale of oil block 13 to Exxon Mobil.
“Although President George Manneh Weah has already commissioned a general concession review, including concessions in the oil sector.”
“These allegations of bribery and misuse of office are deeply concerning.”
“The President has therefore instructed the Minister of Justice Cllr. Frank Musa Dean Jr. to investigate the matter and submit a preliminary report to him within two weeks.”
“The President said if illegality is determined, those culpable would bear the full weight of the law. He urged all to cooperate,” the statement concluded.
Now with the revelation of Cllr. Dean’s proximity to the initial bid rounds, it is unclear how the administration will proceed.
Block 13 was originally awarded by NOCAL in 2005 to Liberian-Anglo company Broadway Consolidated/Peppercoast (BCP). In 2007, the block was ratified by the Liberian legislature through bribery.
In its investigation, the watchdog group published evidence it says shows that the company was likely part-owned by former Mining Minister Jonathan Mason and former Deputy Minister Mulbah Willie.
Mason and Willie are suspected of granting the oil block to a company in which they held interests while they were also ministers in 2005, which was illegal under Liberian law.
Exxon knew that Block 13 was originally awarded through bribery and that its purchase of the oil block could enrich former officials who might have been behind BCP.
GW reported that in a PowerPoint presentation it obtained, Exxon wrote that it was interested in purchasing the oil block despite its “concern over issues regarding US anti-corruption laws.”
GW noted that despite several red flags, Exxon went ahead with the deal anyway. Global Witness’ evidence shows that it structured the transaction in a way to skirt US anti-corruption laws by using a Canadian company – Canadian Overseas Petroleum Limited (COPL) – as a go-between to buy the block.
Senior Campaigner Jonathan Gant declared, “It’s appalling that an oil giant like Exxon would buy up an oil block they knew was tainted by corruption.
“This kind of morally dubious corporate behavior is particularly shocking in a country like Liberia where endemic corruption continues to rob people of opportunities.”
Liberian Equity Shareholders?
Many industry observers are unsure what exactly will the government be investigating given that government is a continuum: The fact that employee bonuses were bribes?
Or that the disclosure documents GOL received from Broadway/Pepper Coast contained names of Liberian officials as equity shareholders? Was it that EXXON introduced COPL to Liberia to evade the Foreign Corrupt Practices Act (FCPA)?
Complicating the controversy is the fact that disclosure documents were filed with the respective stock exchanges and all companies with the exception of Broadway are publicly-traded although Broadway’s primarily owner, RAB Capital was publicity traded.
One legal observer said Saturday it may be near impossible to list government officials as owners owing to the fact that only one Liberian shareholder was listed Cllr David Jallah, who was not a GOL official.
Several of those named in the report have confirmed to FrontPageAfrica that bonuses were documented in Board minutess as well as financial statements and it has been publicly documented that Broadway/Pepper Coast and COPL were owned by RAB Capital.
They were sister companies Broadway borrowed money from COPL using LB#13 as collateral (illegally) months prior to Exxon being introduced to the block.
Former Justice Minister Christiana Tah, in her response to Global Witness which she shared with FrontPageaAfrica after the release of the reported said: “Bonus payments were authorized by NOCAL
The Board of Directors to all NOCAL Staff and others who performed exceptionally in conducting the negotiations on the Exxon Contract.
These bonus payments were made long after the Exxon deal concluded. I understand that even drivers received bonuses.
Do you mean to tell me that Exxon was so desperate that it even bribed drivers? I did not receive money or an offer to pay money from Exxon-Mobil for the award of the oil contract related to Block 13, neither am I aware of anyone who may have requested or received a bribe from the aforesaid company, directly or indirectly.”
Mr. Robert Sirleaf, who was board chair at the time acknowledged that after the contract was signed and the funds transferred, NOCAL paid a bonus to ALL officers, board members and employees of NOCAL (approx. 140+) including drivers, janitors, secretaries and clerks.
“I’m very sure one wouldn’t draw any conclusions that a bonus paid to the entire Company, including all junior staff, was a “bribe.”
“So, your suggestive is preposterous. In fact, the signature bonus Liberia received for the Block 13 contract was about fifteen times more than the largest signature bonus Liberia had previously negotiated for any oil contract,” Mr. Sirleaf, who is also the son of former President Ellen Johnson-Sirleaf told Global Witness.
Former Finance and Economic Planning Minister Amara Konneh for his part categorically denied accepting a bonus through an official NOCAL check as did all others.
“I, Amara M. Konneh, as Minister of Finance and Development Planning at the time, did not solicit or request a bonus or any other payment for the work that I did for the benefit of my country’s oil burgeoning hydrocarbon program.”
COPL reportedly contracted to acquire the Broadway/Peppercoast contract and invested at least US$15,000,000 in the contract well before Exxon/Mobil entered the picture. Prior to Exxon/Mobil entered the picture; COPL and Broadway/Peppercoast had already threatened to invoke the international arbitration clause in the contract if NOCAL attempted to terminate the contract.
The financial backers of COPL and Broadway/Peppercoast, according to NOCAL at the time, had the funds to pursue such arbitration, and even if the arbitration was resolved in favor of Liberia, it could have taken years to reach that conclusion, according to NOCAL.
The oil company was adamant that neither COPL nor Broadway/Peppercoast had the financial or technical capabilities to drill in Liberia’s off-shore deep waters.
From Liberia’s perspective, the argument for NOCAL was that its budding oil sector was faced with a choice between a long, uncertain arbitration process and the possibility of getting stuck with a second-rate exploration company, or an immediate budget contribution of $45 million to Liberia and $5 million to NOCAL, and transfer of operational responsibility under the contract to one of the world’s most highly regarded off-shore operators.
Arbitration Concerns
If the arbitration had occurred, and if Liberia had eventually prevailed, any new contract would likely have been entered at a time at which oil was under US$50 per barrel, rather than the then nearly $100 per barrel.
It is noteworthy that the highest bid in Liberia’s 2014 bid round was $15,000,000 per block, and the two bidders involved backed out of the deal as the oil price continued to fall.
NOCAL boasted at the time that Liberia clearly came out ahead and financially benefited by going forward with Exxon/Mobil rather than trying to terminate the contract.
For the immediate future, many Liberians are cautiously optimistic about the trend the pending investigation in the latest Global Witness investigation will follow.
Many have been left disappointed at the outcome of the previous GW bombshell which uncovered more than US$950,000 in bribes and other suspicious payments by UK mining firm Sable Mining and its Liberian lawyer, Varney Sherman.
The report dubbed The Deceivers (1), showed how in 2010 Sable hired Cllr. Sherman, the former chair of the then ruling Unity Party government, in an effort to secure one of Liberia’s last large mining assets, the Wologizi iron ore concession in northern Liberia.
Senator Sherman told Sable that in order to obtain the contract the company must first get Liberia’s concessions law changed by bribing senior officials, according to a source familiar with the discussions. GW was able to back up the account with leaked emails and company documents.
The investigation headed by Cllr. J. Fonati Koffa sought and won indictment of the former Speaker of the House of Representatives Alex Tyler, Senator Sherman and others for allegedly committing multiple criminal offences, bribery, economic sabotage, criminal conspiracy, solicitation and facilitation.
While the arrest of Tyler and attempted arrest of Cllr. Sherman generated a lot of public interest, the case eventually died a natural death with the new government appearing unlikely to pick up where the old government left.
GW appeared unhappy with the trend of the last case, when it unveiled its report on the Exxon sale.
“Liberia’s attempts to stop corruption have failed – most notably the Sable Mining bribery debacle,” said Gant.
“It is time for President George Weah to show that he is a reformer and task the Ministry of Justice and Anti-Corruption Commission to investigate immediately.”
The probe of the Exxon deal is expected to resurrect some old faces and at least one current lawmaker, Rep. Adolph Lawrence. GW reports that there is strong evidence that Rep. Lawrence, who became a Representative in 2012, held a BCP ownership interest in 2011.
If Lawrence continued to hold this interest when Exxon bought 2013, he also would have broken the law and may have received part of the money Exxon paid BCP.
The report also suggested that if former Lands, Mines and Energy Minister Jonathan Mason did own BCP shares when Exxon bought Block 13, he would have received a share of the US$68.5 million Exxon paid BCP.
Article 90(b) in Play
Mulbah Willie, another former official, who was an assistant minister at LM&E died in 2012, so any money he was owned would likely have gone to his estate.
GW reported that COPL informed its investigators that its due diligence showed that there were no legal problems with the deal, that Mason did not hold shares in BCP, shareholders certified they held no interest for others, and that it received legal advice on its anti-corruption and anti-money laundering obligations.
The company stated that Lawrence resigned from a job he held with BCP in 2011 and that any money he received was reported to the Liberian Government.
Global Witness has also seen evidence that shortly following the authorization of the 2013 Exxon deal senior Liberian officials were paid “bonuses” of US$35,000 by NOCAL – more than doubling their annual salaries.
These officials, and the positions they held at the time, were: NOCAL CEO Randolph McClain, National Investment Chairman Natty Davis, Finance Minister Amara Konneh, Mining Minister Patrick Sendolo, NOCAL Board Chair Robert Sirleaf, who is the son of then-President Ellen Johnson Sirleaf and Justice Minister Christiana Tah Robert Sirleaf was reportedly working pro-bono at the time.
However, he too received a payment of US$35,000.
For now, some Liberians are raising concerns about the potential breach of Article 90(b) of the Constitution which states:
“No person holding public office shall demand and receive any other perquisites, emoluments or benefits, directly or indirectly, on account of any duty required by Government”.
Contacted Sunday, Global Witness lead campaigner Jonathan Gant said It’s very encouraging that President Weah has called for an investigation into the 2013 Block 13 deal,” but cautioned that the review must be led by an independent investigator.
“Justice Minister Musa Dean should not lead it because he has a fundamental conflict of interest, having signed Broadway’s 2005 contract when head of NOCAL.”
The evolving saga could likely prove to be the first major test of the Weah presidency with the world paying keen attention to yet another Global Witness investigation unraveling allegations of bribery, illegal bonuses and a corruption label which dogged its predecessor and now poised to ignite a lightning rod of enormous implications.
