Kuwaiti deal soils oil bosses’ hands

Chris Mahove

The recent fallout at the state-owned fuel enterprise, Petrotrade, which led to the suspension of the board by Energy and Power Development Minister Soda Zhemu recently, has been linked to a shady deal involving a Kuwaiti company, Review & Mail has learnt.
The deal entails the sale of Petrotrade to IPG, the Kuwaiti firm, which is said to be li ked to some army and private bigshots.
In a case of asset stripping, the sale of Petrotrade resulted in losses of thousands of dollars by Government.
A source close to the developments at the weekend told Review & Mail revealed that Zhemu and top brass at the parastatal connived to sell the company to at far less its value without going through proper procedures.
Our source revealed that an army-linked top manager masterminded the deal, in the process allegedly corrupting the minister. The permanent secretary in the ministry, Gloria Magombo, is said to be a lapdog of the senior official, with a history dating back a long time.
“We suspect that he (army-linked, senior official) has been promised a cut by IPG,” the source said, naming others in the Ministry.

No comment could be obtained from the officials at the time of going to print.
The source said suspicions were raised after the realisation that each time the technical team met, IPG representatives would always be waiting at the Ministry for feedback.
“Also when we did not have a Board, it was (the top official) and the Ministry’s representative on the Board , a Gloria Marabada, who were running the company as the “Board”. So these projects where there are no contracts and money being demanded were corruptly rewarded in return for backhanders we think,” added another source.
It has also emerged that the top brass at Petrotrade have stood stridently against a forensic audit at the company when it emerged the company had inflated the amount owed to a contractor who constructed the Warren Park Serviced Station.
“For example, some of the people have said why do you ask for a contract as if you don’t know what we agreed. The pushback against the forensic audit is because it will show that money was being paid not due (sic),” the source added.
On February 28 this year, Petrotrade Board Chaiperson, Tinomudaishe Chinyoka wrote a damning letter to Magombo accusing her and other Ministry officials of unduly meddling in the affairs of the company.
This was after Magombo had written to the board accusing it of making decisions without the approval of the Ministry, including the appointment of the Chief Operations Officer and the Business Development Director.
Chinyoka said the letter was a ploy by ministry officials to divert attention from the investigations of corruption and fraudulent activites that happened during the period when the Ministry had direct oversight over Petrotrade.
He said the purported nullification of the appointment of both the COO and BDD was unfortunate and betrayed the importance of the serious work the two were doing for the company since they were hired, noting the company’s market share had jumped from 2.68 percent to 6.46 per cent since their appointment.
‘It is also not beyond the realms of possibility that the Ministry’s representative on the Board is being manipulated into raising “issues” of corporate governance by those employees that have been involved in corruption and who see the net closing around them since the suspension one key member of their gang a week before your letter was written,” he said.
Chinyoka said the Ministry was attempting to micromanage the company by suggesting that it should approve the operating structure of Petrotrade , saying that was inconsistent with sound corporate governance and was unlawful .
He said it was ultra vires Sub part D of Part iii Chapter iii of the Companies and Other Businesses Act Chapter 29:31 Act No 4 of 2019 (The Companies Act).
“Your Ministry labours under the impression that its the Ministry and not the Board that approves the structures of the entity. It is imperative that your office be fully disabused of this notion -In terms of the law and the Company’s own articles and Memorandum of Association, it is the Board and not the Ministry that is responsible for hiring senior management and for organising the company to best achieve its objectives,”.
Minister Soda’s tenure has been synonymous with controversies and his appointment has coincided with the return of power outages, ever increasing fuel prices and he has made several reckless utterances when confronted over the challenges in his Ministry.
Chinyoka, who was suspended by the Minister, has since made an urgent Chamber application where he raised a litany of allegations against the Minister and Petrotrade Acting CEO, Godfrey Ncube.

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