…Deputy Minister excluded
The Herald, has uncovered further anomalies in the revenue assurance relationship between Strategic Mobilisation Limited (SML) and the Ghana Revenue Authority (GRA), with a significant revelation being the exclusion of the Deputy Minister in charge of Revenue Collection, Abena Osei-Asare.
This development, comes amid intensified media scrutiny on SML, which attributes the controversy to a “Cartel in the oil ring whose illegal trade is being collapsed.” GRA and Finance Ministry are yet to speak.
This newspaper’s investigation reveals the involvement of Ernest D. Akore, an officer at the Finance Ministry, who allegedly takes orders from Finance Minister, Ken Ofori-Atta, to assign additional work to SML, owned by Evans Edusei and Esther Edusei.
Notably, Akore had previously worked under Mr Ofori-Atta at Databank Brokerage Ltd, serving as Executive Director.
Later, he transitioned to the Finance Ministry, where he is sometimes referred to as a Technical Advisor to the Minister for Finance. Akore, identified as “Chef De Cabinet” in the ministry, signed a letter dated June 22, 2023, titled “Expansion of the scope of work by Messrs Strategic Mobilization Limited” and sent it to the Commissioner General of the GRA, Dr Ammishaddai Owusu-Amoah.
In the letter, Akore stated that the Minister for Finance, wanted to extend SML’s Revenue Assurance work to include monitoring upstream oil drilling and gold mining activities.
A “chef de cabinet” is a high-ranking civil servant or official acting as an aide or private secretary to a government figure. It is normally used in the French public service.
His letter, accompanied by a 54-page revised contract, indicated that the Legal Department of the Ministry of Finance had reviewed it. However, it requested the GRA’s Legal Department to review and provide input before signing. Notably, the document lacked the signature of Deputy Minister, Abena Osei-Asare.
The Herald’s attempts to speak to her on the activities of SLM drew blank. Her promise to revert to the paper on October 26, 2023, was not fulfilled. She had replied to a WhatsApp message sent to her on SML and Christian Tetteh Sottie saying, “I’m not aware of the details, so I will have to revert, pls”. But she never did as promised.
But more strange is the discovery that Christian Tetteh Sottie was once an officer of the GRA and had moved to be Controller and Accountant General under the John Kufuor administration.
With the Akufo-Addo, presidency, Christian Tetteh Sottie, returned to play the role of a Technical Advisor to the GRA Commissioner General, but not long after, he left the GRA job to become Managing Director of SML, and went into a financial transaction with the GRA, his former employers, running into hundreds of millions of Ghana Cedi.
Christian Tetteh Sottie, is a board member of the Internal Audit Agency, a state institution as well as a non-executive director of the state-owned State Insurance Company (SIC).
In a statement released by SML’s Public Relations Unit, yesterday, the company alleges that an oil cartel is attempting to undermine the government’s efforts to combat illegalities in the petroleum sector.
SML firmly denies most of the claims made in a recent video documentary by Manasseh Azure Awuni and his Fourth Estate platform, dismissing them as “misrepresentations, false claims, and a general lack of understanding on the entire operations of the company.”
The company challenges Fourth Estate to produce any evidence of a 10-year contract, stating that the 5th PPA Board, approved a contract duration of five years.
Addressing specific points raised in the documentary, SML, refutes the allegation that it receives $100 million annually from its contract, clarifying that its upstream operations have not yet begun, and no revenue has been realized.
The company emphasizes that its engagement with GRA is a risk-reward contract, with GRA making no financial investment in the entire chain. SML is not exempt from duties and taxes, and 31percent of its monthly earnings go to GRA as taxes per the law.
SML challenges the documentary’s author to provide evidence of wrongdoing in the contract arrangement, asserting that its charging formula is standard in the industry.
The company highlights its crucial role in providing base data at the depots for revenue assurance and auditing, contributing to a significant increase in reported figures in the downstream petroleum sector over time.
According to SML, the National Petroleum Authority’s (NPA) system is not adequate for providing revenue assurance for tax purposes.
SML installed ultrasonic flow meters to check volumes of petroleum products in real-time, ensuring accuracy in reconciling with volumes recorded in ICUMS. The company’s work also includes an automatic tank gauging system to replace the current method of measuring fuel volumes, enhancing accuracy and efficiency.
SML takes pride in its skilled technical team, comprised of professionals with diverse backgrounds and extensive experience in the petroleum industry.
The company remains vigilant in the face of what it describes as heightened efforts by the oil ring cartel, emphasizing its commitment to supporting the government’s fight against illegalities in the petroleum sector.
It suggested that Mr Manasseh and his team were hired guns sent after SML, saying “We challenge Fourth Estate to produce any contract anywhere that is for a 10-year period. The 5th PPA Board at its 46th Board meeting in a letter referenced PPA/CEO/09/2286/23 approved a contract duration of five (5) years”.
The company, has taken note of a documentary that has been aired by the fourth estate’s team and placed these on record;
“Again, it’s NOT TRUE that SML takes $100 million annually from its contract. The Upstream operations of the company, has not yet begun, and no revenue has been realized. No monies have been paid to SML; the $100 million per year payment to SML that has been alleged is purely a figment of the author’s imagination and not factual.
“SML’s engagements with GRA, is solely a risk-reward contract. GRA invests nothing in the entire investment chain. There is no cost commitment from the GRA. SML is not exempted from the payment of duties and taxes.
“Again 31% of SML’s would be monthly earnings go to GRA as taxes per the law.
“A good-intentioned and professional investigation would have established SML’s investments cost and compared to its earnings to make an informed position.
“Again, we challenge him to produce any evidence of wrongdoing in this contract arrangement. SML’s charging formula is standard in the industry and same is being used by other service providers in the industry.
“SML’s work forms the base data at the depots for revenue assurance and auditing. They declare the base volumes upon which any gap or deficit in the eventual volumes declared will expose those in the chain.
“The downstream petroleum sector’s reported figures have significantly increased because of SML over the time; from an average of 350 million liters per month in 2018 and 2019, to 450 million liters per month as of June 2020. This indicates a rise of more than thirty-three percent (33%) in volume reporting and an average of an extra 100 million litres per month which translates into revenue.
According to the company, “a careful scrutiny of the work of NPA in terms of taking account and reporting the transactions using ERDMS within the downstream petroleum sector would show that it was not adequate and suited in giving revenue assurance to GRA. The NPA system was designed for its operations and was not suited for providing revenue assurance for tax purposes.
“SML installed ultrasonic flow meters to check the volumes of petroleum products loaded at the gantries from the depots to reconcile in real time with the volumes recorded in ICUMS. This system additionally assures Customs that no loading activities occur in the depot in their absence. The installed metering system is designed to detect and record the movement of petroleum products at the depots.
“SML’s work is designed to culminate in the checking of the products in the tank using automatic tank gauging system. This aims at replacing the current system of Custom Officers climbing the tank using a dipstick to measure fuel volumes. By utilizing this, the GRA can calculate the overall quantity of petroleum products in depots nationwide to gauge revenue, provide Customs with data for reconciliation, and facilitate the tracking of oil movements during inter-depot and inter-tank transfers. Moreover, it aids in identifying leaks and notification of overfills.
“SML takes pride in its committed and highly skilled technical team, whose combined expertise propels our success in delivering innovative solutions. The team consists of seasoned professionals with diverse backgrounds, ensuring a comprehensive approach to addressing the most intricate technical challenges. The SML technical team comprises Ghanaian-trained engineers and expatriates from the United States, with work experience ranging from 5 to 25 years in the petroleum industry and the instrumentation and controls sector. The team’s expertise spans across petroleum engineering, process engineering, IT System Engineering, Cybersecurity Engineering, instrumentation, and controls, as well as Electrical and Mechanical Engineering.
”We are aware of the heightened efforts by the Cartel in the oil ring whose illegal trade is being collapsed and is fighting to undermine the Government’s fight against illegalities in the petroleum sector.
