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Raila wants anti-graft agencies to investigate gov’t’s G2G oil deal

Tuesday, November 28th, 2023 15:23 | By
'Natoa shukrani kwao' - Raila says Bomet residents were justified to heckle CS Chirchir
Azimio la Umoja leader Raila Odinga at a past press conference. PHOTO/Njenga Kung'u

Azimio la Umoja-One Kenya coalition party leader Raila Odinga has petitioned antigraft agencies to investigate the government's G-2-G oil deal with Saudi Arabia and the United Arab Emirates.

Through his lawyer Paul Mwangi, Raila wants the Ethics and Anti-corruption Commission (EACC), the Office of the Auditor General and the Energy and Petroleum Regulatory Authority to discharge their mandates over the issue.

The G-2-G deal announced by the government earlier this year was meant to ease the cost of importing oil and consequently ease fuel prices in the country. However, months later, the cost of fuel in the country has continued to rise.

Raila says the deal, which was signed in March 2023, involved the Government of Kenya through the Ministry of Energy and Petroleum with Aramco Trading Fujairah FZE, Emirates National Oil Company (Singapore) Private Limited and Abu Dhabi National Oil Company Limited.

"Despite the attempt to fashion the oil importation deal as a sovereign arrangement between the Government of Kenya and the Government of Saudi Arabia and the United Arab Emirates, this a commercial contractual arrangement with private companies. At least one of these companies is not incorporated in the country which it is purported to represent as a sovereign entity. Indeed, none of them even purport to represent any of the governments claimed as popularly stated," Mwangi said in his letter to the government agencies.

"Not surprising therefore, we have not seen the phrase "Government to Government "used anywhere in the copies of the Master Framework agreements shown to us nor any reference to any understanding between the Government of Kenya and any sovereign government. But surprisingly, it is the Operational Agreement that started using the phrase "Government to Government", the purpose for which as said was to undermine Kenya's laws on the procurement of goods and services."

Mwangi terms the contracts as "contradicting and illogical" since they are dubbed as sovereign contracts yet there was procurement of international suppliers.

"Although the Operational Agreement numerously uses the phrase "Government to Government Framework", this phrase is not used by the Master Framework Agreement on which the Operational Agreement is based. Further, a reading of the Operational Agreement makes it clear that three nominated oil marketing companies are agents of the people of Kenya and not agents of the international suppliers," Mwangi adds.

"Indeed, in the Master Framework Agreement, the Nominated OMC's (Oil Marketing Companies) are referred to as "the buyer" of Petroleum products" under the agreement. It is again contradictory, and illogical, that a foreign supplier gets to nominate the buyer of its products and also nominates the agent for the people of Kenya under the Petroleum Act."

According to Mwangi's letter, although the agreement is between the Government of Kenya, three locally incorporated oil marketing companies licensed by the government and a bank where the government is a major shareholder, the agreement is to be " governed by, interpreted and construed in accordance with the laws of England"

"Further, in case of an arbitration following a dispute, the arbitration shall be conducted under the Rules of Arbitration of the London Court of International Arbitration. The seat of Arbitration shall be London, England. Hearings and meetings will be held in London England. Lastly, the arbitration clause "including its validity and scope, shall be governed by English laws. These are just some of the glaring issues that call upon you to commence thorough investigations into this saga," he added.

Raila speaks

This comes days after Raila raised an alarm over the G-2-G contract signed in March, calling for the resignation of Energy Cabinet Secretary Davis Chirchir and his Treasury counterpart Njuguna Ndung'u.

 Raila said the oil deal was fraudulent and one hatched to illegally withdraw money from the exchequer to pay shady private firms.

Raila claimed that part of the money was used to finance businesswoman Ann Njeri Njoroge in a contentious Ksh17 billion fuel deal that hit the headlines recently. The claims were first made by Busia Senator Okiya Omtatah.

"He (Omtatah) was able to establish a link between the Ksh17,224,718,632 which was unconstitutionally withdrawn from the Consolidated Fund in June 2023 to subsidize unnamed private financial enterprises and the Ksh17 billion contested oil shipment between Ms. Njeri and the two Cabinet Secretaries," Raila said.

"I concur with the senator’s suspicion that Njeri is the ‘private financial enterprise’s funded by the Ksh17,224,718,632 illegally from the Consolidated Fund and received by the Ministry of Petroleum."

The former prime minister said the two CSs had committed criminal offences and should not only resign but also be prosecuted.

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