Unconfirmed reports yesterday revealed that the MD/CEO of Capital Oil and Gas, Mr. Ifeanyi Ubah, had been arrested by officials of the Department of State Services (DSS). However, earlier today, he refuted the allegations stating that no such thing occured and that it was the work of mischief makers.
The company has been in the news lately over an alleged sale of petroleum products kept in its custody by the Nigerian National Petroleum Corporation (NNPC), along with MRS Oil and Gas.
Capital Oil was yet to refund 82 million litres of petrol worth N11 billion out of the 100 million litres it took. MRS in its defence stated that it had not taken the products, but transferred them to the Petroleum Products Marketing Company (PPMC) on written instruction by the NNPC. The management of Capital Oil and Gas is yet to give an official press release on this development.
The products were kept with the companies under an arrangement known as ‘through put’. Oil companies with large storage facilities store petroleum products owned by other parties for a fee. Products belonging to different companies are kept in one storage facility. Companies that need their products give a 7-day notice within which the products are replaced.
Why is the company yet to issue a press release one week after the allegation by the NNPC? Could it be that it had no records of products in its custody?
Capital Oil clearly has corporate governance issues and lacks a clear operating structure. The firm was taken over by the Asset Management Company of Nigeria (AMCON) in August 2013, after the bank had acquired several of the company’s delinquent loans.
Founder and Managing Director of the company, Ifeanyi Ubah was asked to step aside. However, in November 2014, following a debt service agreement with AMCON, the running of the company was handed back to him. The company is very likely to encounter more difficulties if it continues down this road.
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