Oil bubble bursts

Tuesday October 11 2011

 Oil bubble bursts

MPs Gerald Karuhanga (L), Robert Ssekitooleko (R) and Latiff Ssebaggala after yesterday’s session. photo by Geoffrey Sseruyange 

By Yasiin Mugerwa, Sheila Naturinda and Isaac Imaka

A Uganda MP yesterday submitted a document that pointed a finger at several ministers, including Prime Minister Amama Mbabazi, as having pocketed billions of shillings in commissions as the House opened a stormy debate on what they called the “shameless corruption” ripping through the oil sector.

The dossier titled: “Brief on Uganda’s Oil deals” was tabled by the Youth MP for Western Uganda, Mr Gerald Karuhanga, containing alleged details of dates and bank transactions through which the illegal payments were reportedly made.

Mr Karuhanga said he was “ready to die for telling the truth” as he identified Foreign Affairs Minister Sam Kutesa, former Energy Minister, now Minister for Internal Affairs Minister Hillary Onek and former Security Minister now Prime Minister Mbabazi as the alleged beneficiaries.

Mr Karuhanga said Mr Kutesa was at one point given Power of Attorney by Tullow Oil, a British company involved in oil activities in Uganda, and that he received Euros 17.5 million (about Shs68.5 billion).

The money was allegedly processed under the name of the East Africa Development Limited in Nairobi, Kenya. Under the deal, Mr Karuhanga said Mr Kutesa was to receive the money through his bank, EFK bank in Zurich. According to the dossier, between June 21 and August 2010, Eng. Onek received a total of Euros 5.6 million (about Shs21.9 billion) from Tullow Oil, reportedly paid in several installments.

It is alleged that Onek received the money through an Emirates Bank account in Dubai, United Arab Emirates (UAE). Mr Karuhanga told Parliament that Tullow pledged $100 million (about Shs286.4 billion) to “these well connected influential Ugandans” in relation to the arbitration case in London.

Mr Karuhanga said it was in Tullow’s interest that Heritage Oil, which sold its stake to Tullow, drags government of Uganda to London for arbitration in order to set up a precedent to be used by other oil companies in farming out their interests from Uganda.

The Ugandan team of alleged beneficiaries to this pay-out is referred to as “experts”. They were reportedly led by Mr Kutesa. Others were Mr Onek, former Acting Solicitor General and now a judge Mr Billy Kainamura and the Deputy Secretary to the Treasury Keith Muhakanizi. It’s alleged that their payment was for “professional services”.

These accusations come at a time when Mr Kutesa and two other ministers are supposed to appear before the Anti-Corruption Court on Thursday to answer charges relating to the misuse of Shs14 billion in Chogm funds.

In another dossier titled: “Tullow sees corruption in oil sector,” Mr Karuhanga said Tullow vice president for Africa Tim O’Hanlon identified Security Minister Amama Mbabazi and Onek as Ugandan officials who benefited from the attempted sale of production rights by Heritage Oil and Gas to Italian company ENI.

A visibly agitated Mr Kutesa, who stood on a point of order amid a barrage of taunts from lawmakers, denied the allegations.

“Hon. Karuhanga has alleged that I received bribes through my company in Nairobi, is it in order to use this House and the privileges attached to members to table falsehoods? Is he in order to make defamatory statements against me which are false and well-knowing that that he cannot repeat them outside this chamber,” Mr Kutesa said.

Mr Kutesa accused Mr Karuhanga of using forged documents “that have been circulating in the city”.

While Eng. Onek was not in the House, Mr Mbabazi did not say a word. The Speaker adjourned the debate to today 11am.