A Trip Down Memory Lane�Kan Dapaah VRS Tsatsu Tsikata

�In A Battle Over Drill Ships, Oil Rigs & �Hedging Dealings�! Corporate Ghana last Wednesday recorded one of her lowest moments when officials of the Ghana National Petroleum Authority (GNPC) and the Bank of Ghana (BoG) both disclosed that they did not have the transaction records and cash transfer of the sale of drill ship, Discoverer 511 which belonged to the GNPC. The unfortunate disclosure by the State officials created a needless controversy over the sale and purchase of the State asset especially where just a little over a decade ago, Mr. Tsatsu Tsikata, the longest serving Chief Executive of the GNPC and Albert Kan Dapaah, a former Minister of Energy both had occasion to expatiate on the circumstances surrounding the sale and purchase of the Discoverer 511. After the sale of the drill ship, Mr Kan Dapaah, then Minister of Energy, held a press conference on 8th August, 2001 to officially announce the transaction and also accused Mr. Tsikata of mismanagement. On 6th September, 2001, Mr. Tsikata also held a press conference to counter the earlier claims of the Minister. The New Crusading GUIDE will in subsequent editions, publish our independent findings on the circumstances leading to the sale and purchase of the Discoverer 511 drill ship. For the purposes of refreshing the minds of our cherished readers, we reproduce below relevant excerpts of the press statements by both former state officials. KAN DAPAAH SPEAKS, AUGUST 8, 2001 *Introduction : Ladies and Gentlemen, on Thursday 27th July, the Government issued a statement on the sale of GNPC's oil drilling ship, "DISCOVERER 511", to pay for a $47 million loss incurred by Mr Tsatsu Tsikata, the former Chief Executive of the corporation in hedging dealings with Societe General, a French commodities bank. The statement promised a later press conference to give full details of the sale and other related matters. * Facts: Ladies and Gentlemen, the hard facts of this catastrophic financial loss to our nation are as follows. Around the middle of 1996, Mr Tsikata, presented himself to Societe Generale, in the words of the bank, as "a commercial, legally trained businessman, sophisticated in terms of his understanding of derivatives trading and the theory behind how derivatives work and how they can be used." He informed the bank that GNPC traded in derivatives and was keen to transact business with it. Mr Tsikata's business was selling the crude oil, which had been allocated specifically by the Nigerian Government to be refined at the Tema Oil Refinery to supply our country's petroleum products needs. Mr Tsikata decided to sell our oil on the international market instead of making the allocation available to Ghanaians, and wanted to hedge his risks. Mr Tsikata also told the bank that GNPC's Tano oilfield was scheduled to start production within 12-18 months. This was also in 1996. In a set of very complex hedging transactions which started in October 1996, Mr Tsikata was paid either a premium by the bank or he paid the bank certain sums of money depending on whether the market price of oil stayed below or above the predicted ('strike') price. In effect, Mr Tsikata was gambling with our oil while the people of Ghana were queuing for petrol. Mr Tsikata was hoping to reap enormous profits by selling our oil in advance of delivering the product. What Mr Tsikata had not fully comprehended, was the very basic fact that he had no infallible disposition to predict oil prices with absolute certainly. Like all who dabbled in the hedging business, Mr Tsikata's hedging sophistry was also subject to the extreme volatility of the oil market. Thus, when the oil prices started to decline, Mr Tsikata started to lose massive sums of money. Under the arrangement with the bank, the more money he lost, the more he had to fall on the bank to bail him out and increase his indebtedness to the bank. As matters got worse and his financial situation deteriorated, Mr Tsikata refused the bank's advice to cut his losses and run. Rather he decided to up the stakes in gambling our national assets. Mr Tsikata executed a mortage of GNPC's only viable asset, the oil drill ship "Discoverer 511", in favour of the bank in the sum of $32 million. The drill ship was purchased and refurbished by GNPC in 1992 at a total cost of $25.74 million. The mortgage amount was to secure his outstanding losses to the bank, but more recklessly, also to enable him to carry on with the gambling of our Nigerian allocated crude oil and the anticipated yield from the Tano field. And so he carried on gambling in his own merry way such that by July 1998, Mr Tsikata had run up debts to the value of the mortgaged ship and the bank entangled in Mr Tsikata's high stake gambling of Ghana's precious assets. Quite apart from reaching the $32 million limit of the security on the drill ship, Mr Tsikata was also paid a net premium of $8 million by Societe Generale, which brought his total indebtedness to the bank to $40 million. Mr Tsikata accepted the indebtedness to the bank and promised to settle the outstanding debt. Unfortunately, he failed to keep to his word for several months, with the result that in early 1999, Societe Generale instituted legal proceedings in the High Court in London to recover its money, including interest and the costs of the legal process. Meanwhile, an arrest order was granted to the bank for the arrest and detention of "Discoverer 511" which was by now laid up in the offshore waters of Oman. On 6th June this year, the London High Court ruled in favour of Societe for the full $40 million sum, together with interest and costs totaling a further $7 million bringing Mr. Tsikata's total indebtedness to the bank to $47 million. In order to get its money, the bank decided to sell the drill ship and to pursue the GNPC for any balance, should the proceeds of the sale not be able to cover the full amount of indebtedness. Faced with the imminent loss of the drill ship, the government dispatched the Deputy Minister of Energy, on June 13, to London and Paris to try and reach a negotiated settlement with the bank. The Deputy Minister was also to ensure an orderly sale of the ship to obtain proper market price, if it became inevitable that it had to be sold. After almost six weeks of intensive negotiations Societe Generale agreed to accept $19.5 million in full and final settlement of Mr Tsikata's indebtedness to the bank. The bank however, would not release the ship from arrest until the settlement figure was paid in full and immediately. Under the circumstances, the Government directed the Deputy Minister to sell the drill ship at the best price that could be obtained on the international market. Consequently, the ship was sold to Frontier Drilling of Norway for $24 million, with the formal transaction for the sale being concluded on 17th July 2001. *Related Matters: The massive loss to the nation of Mr. Tsikata's gambling with our Nigerian crude oil allocation and the future produce from the Tano fields is grave enough. Unfortunately, it is not only disaster which has been bequeathed to our nation by Mr. Tsikata. There are other disastrous adventures by Mr Tsikata, many undertaken without the consent of GNPC's Board and often in contravention of the laws of the land. Ladies and Gentlemen, the Societe Generale debt was not the only bungling operation. He also incurred losses of $17.21 million to Credit Suisse and $8.9 million to the Union Bank of Switzerland (UBS). Credit Suisse has served notice on GNPC of its intention to go to court and we should expect UBS to follow suit in due course. Mr. Tsikata spent a staggering amount of $62.49 million to acquire and refurbish six other old and dilapidated rigs and marine assets which are littered all over the world from America through Angola to Gabon. Remarkably, none of these rigs has ever worked or earned one pesewa. And yet, our nation is saddled with the problem of maintaining these rigs at the staggering cost of $138,430 per month. Current valuation of these rigs indicates that selling the rigs will fetch far less than the price they were bought for. GNPC's financial misadventures were not confined to foreign exploits. Here in Ghana, creditors continue to pursue the repayments of a legacy of massive debts. As at July 2001, a Mrs Boohene had obtained judgement for the sum of �307.63 million. A sum of �1.064 billion was also entered in judgement for Total Ghana Ltd. on 13th July 2001. The company has now served notice of its intention to go into execution by auctioning assets of GNPC. In September 1998, Mr Tsikata arranged for a loan of �7.2 billion from Consolidated Discount House. This was to be repaid with the proceeds from the sale of GNPC's shares in Ecobank (GH) Ltd. Mr Tsikata however, diverted the Ecobank proceeds for other purposes without paying the loan. As at the 4th of June 2001, the debt to Ecobank (including interest) had soared to �13.8 billion. In addition, Ecobank is claiming legal costs of over �5 billion. It is worth nothing that the loan was taken by Mr Tsikata without Board approval and in a blatant defiance of GNPC's enabling Act, PNDC Law 64. Even though the GNPC was set up to explore the petroleum potential of the country, Mr Tsikata decided to go into cocoa farming. To this end, in 1990, he acquired shares in two plantations owned by a company called Valley Farms Ltd. at Nyankoman and Assin Nsuta. A staggering sum of about $1 million was sunk into this venture. Quite incredibly and astonishingly, not a single soul at GNPC, knows where exactly these farms are located. *Next Steps: Ladies and Gentlemen, we have put before you today, some of the major facts which have led to enormous financial crises bequeathed to the NPP government by Mr. Tsatsu Tsikata's stewardship of GNPC for nearly twenty years. We believe that the people of Ghana need to be told of some of the principal reasons for the seemingly harsh but necessary decisions which the government is having to take to pay off the gambling and other related debts arising from the imprudent handling of the activities of GNPC. The Government has commissioned a forensic audit into the activities of GNPC which have resulted in this monumental loss to the State. This investigation will be carried out within the framework and the processes of the laws of the land. Ladies and gentlemen, I assure you that the government would get to the bottom of GNPC's financial activities with fair but firm hands. Thank you for coming and for your attention. TSATSU TSIKATA RESPONDS, SEPTEMBER 6, 2001 Ladies and Gentlemen of the media, Thank you for making time for me this morning and also for allowing me the use of your Press Centre for this media conference. You recall that on August 8, the Honourable Minister of Energy made a statement to you in which he made many accusations against me. This followed a statement issued by the Government Spokesperson on July 27 to the effect that the GNPC drillship, Discoverer 511 (D511) had been sold to pay for losses incurred by me in derivatives transactions with Societe Generale, a bank headquartered in Paris which had obtained a judgement against GNPC in the total sum of US $47million. *THE SOCIETE GENERALE CASE: Ladies and Gentlemen, in his statement, the Honourable Minister gave what he called �the hard facts,� starting with the claim that I presented myself to Societe Generale �in the words of the bank, as �a commercial, legally trained businessman, sophisticated in terms of his understanding of derivatives trading and the theory behind how derivatives work and how they can be used.�� This is not true. That is just not me. Societe Generale rather presented themselves to me in my capacity as Chief Executive of GNPC as being able to assist the Corporation with financing for our various activities, particularly the Tano Fields development which I indicated to them was our priority. I invited them to make presentations to other staff of GNPC. I did not inform them that GNPC traded in derivatives and was keen to transact business with them. Societe Generale�s expertise in relation to derivatives was one of their selling points and they provided relevant corporate information to back this. There were also ready credit lines for these transactions to be undertaken, expressly in relation to the Tano fields development and not in relation to the sale of oil on the international market. Societe Generale made it clear that financing of the sort required by GNPC would require undertaking derivatives transactions to ensure that future oil price movements do not adversely affect the ability of the Corporation to repay debts incurred on the project. From the onset, I emphasised to them the need for their technical assistance in enabling GNPC achieve the objective of managing the risks involved. I specifically made requests for the training of GNPC personnel involved in these transactions and asked Societe Generale to make relevant software tools for assessing and managing the positions GNPC held. Societe Generale agreed to provide this help and actually trained some GNPC personnel and assisted with software and other material. Ladies and gentlemen, how then can a person who made such requests that were acceded to by Societe Generale be accused of presenting himself to Societe General as being sophisticated in terms of understanding of derivatives trading and the theory behind how derivatives work? Yet, as in so many parts of his statement, the Honourable Minister chooses to quote copiously from Societe General�s self-serving statements without giving the public the benefit of knowing that these were disputed and that there was testimony in the court proceedings which contradicted these statements of Societe Generale. The basic strategy for the derivative transactions was recommended by Societe Generale and they provided the credit lines for the transactions and controlled what transactions were acceptable throughout the period. At various points, they expressed satisfaction with our compliance with their recommended strategy by increasing their credit to GNPC to continue these transactions. When there were delays in respect of project implementation, they were notified but that did not prevent them from giving increased credit for the transactions. It was not on the basis of any claim to infallibility about oil prices that these transactions were entered into. Rather, recognising both my own fallibility and limitations as well as those of the Corporation I was heading, I sought help and guidance from Societe Generale. As the Honourable Minister noted, these are complex transactions, but it is wrong to regard them as gambling. They are part of normal industry practice in the commodity world and are a regular feature of commodity financing transactions. The need to develop national expertise is clear, and we asked Societe Generale to help GNPC build this capacity, especially as it related to raising finance for a major project like the Tano Fields development. It was the failure of the strategy recommended by Societe Generale which formed the basis of GNPC�s defence and counterclaim. On a regular basis, personnel of GNPC, including myself, were in contact with the Societe Generale personnel seeking advice and information. Indeed, for this reason, when Societe Generale, after the start of the transactions, presented for signature the standard form agreement and included a clause stating that GNPC had not depended on their advice in connection with these transactions, I specifically objected to it. The lawyer from Societe Generale to whom I made the objection noted it and said she would discuss it with her colleagues and revert. Subsequently, Societe Generale took out that clause before the agreement was signed. This is all in the documents provided to the High Court in London even from the Societe Generale side. In respect of the mortgage that was entered into on the drillship, the mortgage document was executed expressly at the request of Societe Generale on the basis that it would enable the parties the opportunity to discuss how best to handle the situation without resort to litigation. I expressed a preference for avoiding litigation, but also made it clear that the mortgage document could not have certain provisions that Societe Generale�s lawyers proposed which would have stated certain sums to be �due and payable� to Societe Generale. These provisions were again omitted because of the mutual understanding about the document. All these background facts, which featured in the court proceedings in both the US and UK, are conveniently omitted from the account of this mortgage. The circumstances in which judgement was obtained by Societe Generale against GNPC in the High Court in London were not disclosed by the Honourable Minister. The �hard facts� are as follows: GNPC had been contesting the claims of Societe Generale since the Bank instituted their action in 1999. A statement of defence and counterclaim was filed on behalf of GNPC. These were based on the fact that Societe Generale had provided negligent advice to the Corporation with regard to the strategy it recommended for the Corporation to hedge its anticipated production of oil and gas from the Tano Fields. An important element of the GNPC case was the testimony of an expert on derivatives based in Chicago, Dr. Culp, who wrote a report showing that Societe Generale had acted negligently in its advice to GNPC. After the GNPC statement of defence and counterclaim papers were filed, Societe Generale requested further and better particulars and detailed answers were given in response. The High Court in London held a sitting sometime last year in which it gave directions regarding the conduct of the case, especially on the exchange of documents between the parties. GNPC and its lawyers took steps to comply with the directions of the Court and, among other things, filed witness statements from relevant personnel of GNPC, including myself, regarding these transactions. Again, as required by the judicial process, GNPC and Societe Generale disclosed to each other records in the possession of each regarding the transactions. Societe Generale even demanded records on derivative transactions with two other banks, CSFB and UBS Warburg Dillon Read and these were provided. Ladies and Gentlemen, in some of the documents disclosed by Societe Generale to the GNPC lawyers, certain passages had been blacked out because Societe Generale claimed they did not have to disclose those passages. An application was made to the court on behalf of GNPC seeking to have disclosures of some of those passages which GNPC�s lawyers considered were relevant to proving GNPC�s case. An application was also made to have tape recordings made by Societe Generale in connection with transactions disclosed. Societe Generale were claiming that almost all the tape recordings had been deleted except for a few; this did not appear satisfactory to GNPC�s lawyers, hence the application to the court for Societe Generale to disclose them. *WITHDRAWAL OF GNPC SOLICITORS AND JUDGEMENT AGAINST GNPC: These applications were pending before the Court, affidavits had been filed in support, including one by me. Subsequently, GNPC was instructed by Government to notify the Solicitors that the case would no longer be handled by them but by the Attorney General�s Department in Ghana. Though GNPC had some payment arrears in respect of the Solicitor�s fees, efforts were being made to settle these and the Solicitors continued to represent the Corporation�s interest until they received instructions to stop and hand over to the Attorney-General. The Solicitors for GNPC therefore obtained permission from the Court to withdraw from acting for the Corporation. The important applications they had made to the court were therefore not pursued. Obviously taking advantage of this situation, Societe General applied to the Court to make certain amendments to their case and then, thereafter, applied for judgement against GNPC. There was no representation by or on behalf of GNPC, and judgment was entered against the Corporation. *PREVIOUS LAWSUIT BY SOCIETE GENERALE IN THE US: Before Societe Generale brought their claim in the London High Court, they had earlier in 1998 filed a suit in the United States-in the District Court in Houston-seeking an order to have the GNPC drillship, D511, moved to the US and detained by them upon conclusion of its contract in Mexico. This suit was brought against the US company that had chartered the drillship as well as GNPC. The case of Societe Generale was thrown out and when they appealed to the Court of Appeal in New Orleans, they were again unsuccessful. It emerged in those proceedings that Societe Generale had sought legal advice about taking action in Mexico, where the drillship was operating, or in Panama where the drillship was registered, and they realised that they could not succeed in either jurisdiction if they filed a suit. *CORPORATE TRANSACTIONS: Ladies and Gentlemen, it must be emphasised that throughout the transactions with GNPC, Societe Generale had accepted that they were dealing with GNPC as a commercial body and that there was no Governmental responsibility they could fall back on. That is why the claims they were pursuing were against GNPC solely and not the Government. It appears strange to me that the Honourable Minister now completely disregards that accepted basis which Societe General has never disputed and, worse still, is accepting the claims when the Corporation detailed reasons for contesting them, and resisted the claims brought in the UK High Court. Together with other personnel of GNPC, I provided the GNPC Solicitors evidence on the basis of which the defence and counter claim were filed. It is regrettable that the Honourable Minister relies on rejected allegations in Societe Generale�s case to paint a picture to the public that is far from the truth. The Honourable Minister also fails to refer to a documented acknowledgement by the Chief Executive of Societe Generale himself that the delays in the implementation of the Tano Project had created the difficulties that GNPC faced. *ALLEGED PAYMENTS TO ME: Ladies and Gentlemen, again, certain statements made by the Honourable Minister in respect of the transactions are also not true. For example, �Mr. Tsikata was paid either a premium by the Bank or he paid the Bank certain sums of money,� and �Mr. Tsikata was also paid a net premium of $8million.� All payments made by Societe Generale in respect of these transactions were payments to GNPC and are reflected in the accounts of GNPC as well as in the transfer instructions of Societe Generale. Anyone can go through the bank accounts of GNPC any day and see the payments from and to Societe Generale. No doubt, the forensic audit that the Honourable Minister says has been commissioned will show these funds movements which the Minister tries to portray as personal funds movements when he knows this is not the case at all. What emerges from these records is that, by December 1997, prior to the sharp price movements affecting the positions held by the Corporation, GNPC had positive cash flows from the transactions with Societe Generale of about US$10million, part of which was used for expenditures on the Tano Project and part for investments in telecommunications assets for the Corporation. I may point out that similar cashflow gains were made in the transactions with CSFB and UBS and the claims of these banks were also being negotiated with a view to a settlement. The Honourable Minister portrays the cashflow gains of the Corporation in the case of Societe Generale as �a net premium of US$8million� paid to me. This is not true. *PERSONALISATION: Ladies and Gentlemen, it is unfortunate that the Honourable Minister seeks to personalise completely these transactions. If the Honourable Minister really believes, however, that I just acted by myself, or that these transactions were just gambling, wouldn�t that have been the more reason to resist the claims of Societe Generale against GNPC instead of allowing them to go uncontested for judgement to be entered against the Corporation, and an asset of the Corporation arrested? There is no question that as Chief Executive of the Corporation, I played a leading role in respect of these transactions, but the records, including the tape recordings which GNPC�s Solicitors were asking for, indicate clearly that these were not activities that I undertook single-handedly or for myself as is being claimed. Among other records made available to the Court are, for instance, records of meetings of the Risk Management Committee in GNPC, which regularly reviewed and monitored the positions arising from the derivatives transactions. *SETTLEMENT DISCUSSIONS: Let me also point out that discussions regarding settlement of the claims of Societe Generale had gone on both before their court actions and after. Indeed, after they started the action in London, one of their management personnel who visited Ghana as part of a French commercial delegation called on me at GNPC with the indication of their willingness to discuss settlement. I communicated this to the GNPC solicitors who began to have discussions on possible settlement. These discussions had not reached a conclusion. Societe Generale�s settlement proposal was for US$20million. This led to a counterproposal from the GNPC lawyers for a US$12million settlement payable in instalments from the expected commencement date of production from the Tano fields. Societe Generale lawyers asked for certain clarifications on this proposal and that is where things stood. There is no doubt that once Societe Generale obtained judgement in the absence of GNPC, it became more difficult to obtain the best price for the drillship. Ladies and Gentlemen, the Honourable Minister also made reference to the High Court judgement in favour of Societe Generale for the full $40million together with interest and costs �bringing,� as he put it, �Mr. Tsikata�s indebtedness to the bank to $47million.� As I pointed out earlier, if it was my personal debt there is no reason for it to be recovered from GNPC or for a GNPC asset to be seized or sold in connection with the debt. I do not accept the Societe Generale claims as legitimate. Yet, based on my alleged indebtedness, he goes on to say that, �the government despatched the Deputy Minister of Energy to London and Paris to try and reach a negotiated settlement with the bank.� Was the Deputy Minister negotiating on my behalf? The Honourable Minister states that a figure of US$19.5million in �full and final settlement of Mr. Tsikata�s indebtedness to the bank� was reached with Societe Generale by the Deputy Minister of Energy. *DRILLSHIP VALUE: He also states that, the drillship was sold for US$24million. According to reports in oil industry circles, it was sold for US$24million plus transaction costs. To obtain the full picture, these transaction costs must be disclosed and added, especially in making comparisons with the purchase price. It would also be important to know to whom payments have been made in respect of these transaction costs. The Honourable Minister states that �the D511 had been purchased and refurbished by GNPC in 1992 at a total cost of $25.74million� He does not say that the drillship earned income of over US$15million from operating in Mexico. The drillship was acquired for US$12million. It was used by GNPC to drill a number of wells in the Tano basin and for conducting an extended well-test for the South Tano field for some nine months during which oil was produced. Even if the total cost of refurbishing the rig was US$13.74 million (taking out the purchase price from the Minister�s figure), the earnings of over US$15million from the rig�s operations in Mexico cannot be disregarded in the computations. Nor can the �earnings� attributable to work done for GNPC be ignored in presenting the statement of affairs on the drillship. *OTHER RIGS: Ladies and Gentlemen, it needs also to be pointed out that in respect of the two rigs that were to have been used to service requirements of the Angolan national oil company, Sonangol, there was a project mobilisation payment to GNPC of some US$11million.Yet, they are among the rigs which are said never to have earned one pesewa. Nor is there acknowledgement of the US$10million insurance payment in favour of GNPC in respect of one of the rigs, which was purchased for about US$3million and which had an accident in the course of being moved to a drilling location. It is a pity that the Honourable Minister seeks to dismiss these assets as �old and dilapidated� without an appreciation of the value attached to these assets, particularly in the current market. For even as old a rig as that on the Saltpond field, a value of US$500,000 was obtained by GNPC in negotiations which led to financing becoming available for the rehabilitation of the field. What does not help in the achievement of value is the kind of asset downgrade indulged in by the Honourable Minister. The original purpose of acquiring these items was for projects that the Corporation was undertaking or providing services for, particularly, the Tano Project. In the case of the project in Angola, in conjunction with a U.S.-based company, we were providing equipment and services to the Angolan national oil company, Sonangol. Unfortunately, the civil war in Angola disrupted the execution of the contract and equipment of the Corporation is still in an area where it is feared there may be mines. In the case of the Tano Project, unexpected delays in implementation have occurred. It has been necessary to keep the equipment maintained so as to derive value from them in future use. This is still a realistic prospect. There has been interest expressed in purchase of these various assets over the years, but the uncertainties concerning the projects for which they were acquired had not made a distress disposal the best option to adopt. Market conditions for such offshore equipment have improved tremendously because of high oil prices and there are many industry projects for which these items of equipment are very suitable, and can realise significant value. *SALE OF CRUDE OIL ON THE INTERNATIONAL MARKET WHILST GHANAIANS QUEUED: Ladies and Gentlemen, among the other charges levelled by the Honourable Minister is that I decided to sell �our oil on the international market instead of making the allocation available to Ghanaians.� I did no such thing. What are the facts? Since the establishment of GNPC in 1985, one of the functions that it performed, taking over from the old Petroleum Department was that of importing crude oil to the country, and having it refined at the Tema Oil Refinery (or, occasionally, in other refineries such as the Abidjan Refinery). GNPC then sold the petroleum products to the oil marketing companies. Residual fuel, surplus to national requirements, was sold on the international market. There is no question about the success of GNPC in satisfying the needs of Ghanaians even through difficult periods in the nation�s history and on the international oil markets. Despite the fact that the Corporation had not been capitalised to undertake either this or any other activities it was mandated to carry out, the Corporation was able to sustain the availability of petroleum products through the eighties and the 1990s until in August 1996, when a �liberalisation� of the crude oil import process was initiated, apparently at the instance of the World Bank and the IMF. Instead of GNPC being the sole supplier to the refinery, a Tender Board was established at the Refinery, which periodically called upon registered oil traders to submit bids to supply crude oil to the Refinery. It was thought that this could cut the cost of imports through competition. Indeed, there had been representations made on behalf of the foreign oil marketing companies about their ability to supply crude oil to the Refinery cheaper than through direct imports from Nigeria. Within the new arrangement, GNPC, which still had its contract with the Nigerian National Petroleum Corporation (NNPC) renewed on an annual basis, would bid like any other bidder for supply to the Refinery. The winning bidder was not dependent in any way on GNPC�s contract with NNPC. Meanwhile, GNPC had obligations to lift oil under the contract. Once the Tender Board selected another entity from the tender process to supply crude to the Refinery, the commercially responsible thing for GNPC to do was to sell the crude on the international market just as it previously sold such crude during periods when the Refinery did not require the cargo or was shut down for maintenance. The logic of this was obvious to the Marketing Division of the Corporation and did not even require my intervention for steps to be taken in that regard. GNPC thus fulfilled its obligations under the NNPC contract. The impression that has been created about the �diversion� on the high seas of oil meant for Ghana is something that needs to be corrected. The Honourable Minister should substantiate his claims of Ghanaians queuing for petrol whilst oil was sold by me on the international market by providing one instance when this occurred. It never happened once.