Reps query BPE over N3bn revenue from Iwopin paper mills concession

…as 5 year agreement elapse next year

The House of Representatives’ Committee on Public Petitions on Wednesday queried the Bureau of Public Enterprises (BPE) over the unilateral reduction of the N3 billion expected revenue from concession of Iwopin Paper Mill. The paper mill and other assets including a housing estate was handed to the preferred bidder, Beucan Technical Services Company Ltd in 2014.

Tunde Osinubi of Ifara Chambers, Counsel to the petitioner had accused the investor of turning the assets to scraps. He added that some of those sent by the company to evacuate truck-loads of scrap after BPE’s meeting with some stakeholders were arrested by the Local Government Chairman and detained by the Police.

Aliyu Maigari, BPE Director who appeared before the committee, however explained that the Bureau resolved to review the revenue from N3 billion to N1 billion since the Bureau was unable to meet its offsetting the liabilities and provision of feed-stock for the new investors to commence operation, adding that the Bureau is working hard to fix the challenge.

Maigari who denied insinuating that the Bureau short-change Nigeria by reducing the expected revenue from the transaction, argued that the exercise was transparent and that the Bureau had transferred “the cost of labour of over a billion” to the buyer.

According to him, the Bureau reserves the right to revoke the concession agreement at the expiration of the five year agreement if the preferred bidder failed to meet its obligation.

The BPE’s representative who maintained that similar decision was taken during the NITEL transaction, however noted that resolution was taken at the last meeting with stakeholders in the area not to allow anyone to remove anything from the site.

While speaking, Leo Ene, BPE Deputy Director in charge of monitoring of Iwopin Paper Mill, who inspected the site, observed that between 20 to 30 percent post-concession implementation has been carried out by the preferred winner of the bid when the last evaluation was conducted for 2016.

Ene who expressed dissatisfaction over the implementation level of the agreement, said “I’m not impressed and the implication is revocation.”

Worried by his presentation, Uzoma Nkem-Abonta, chairman, House Committee on Public Petitions however directed the BPE official to provide relevant document which mandated BPE to provide feed-stock for the investor.

Nkem-Abonta who expressed concern over the allegations bothering on asset stripping, noted that the investor had failed to meet its obligation despite carrying out due diligence before expressing interest in the transaction.

“The four years have been wasted for seen and unforeseen problems. Rather than waiting for of failure it’s better you extend the time,” the chairman of the committee advised the investor.

In her remarks, Ebun Braitwathe, Managing Director of the Company, explained that efforts are ongoing to partner with Ogun and Lagos state in the bid to revive the paper mill, adding that N100 billion is being sourced to be injected into the company.

Braitwathe who earlier noted that the company has twin challenge of funding and expertise, solicited for the intervention of the Committee on the partnership with Ogun State government.

While reiterating the company’s intention to revive the Iwopin Paper Mill with the view to create employment and wealth, she explained that the scraps being evacuated from the site were from the collapsed building.

While ruling, Nkem-Abonta who unveiled the committee plan to visit Iwopin Paper Mill alongside BPE officials, advised the investors to formally notify BPE of its challenges and its intention to apply for extension of the post-concession agreement timeline.