The contract was awarded to Messrs Riverbrook Energy Limited at a contact sum of ₦994,415,000.00 through award letter reference No: NDDC/EDP/UIDW/PR/IM/14/564 of 18th December, 2014.with a completion period of 12 months from the date the Agreement was signed.
Examination of documents revealed that there was no Parastatal Tender Board approval for the award of the contract since it was beyond the approval limit of the management. No evidence of compliance with due process in the award of the contract.
Examination of the Bills of Quantities shows that a preliminary sum of ₦56,702,262.52 was added to the contact sum as Bill No.1 without any breakdown of how the amount would be used. The payment vouchers with amounts of N550,280,000 was raised to pay mobilization fees to the above contractor, without relevant supporting documents such as the Unconditional Performance Guarantee/Security Bond from a reputable bank or Insurance company, this was contrary to the provisions of Financial Regulations 603(i) and 2933 which states that ‘’all vouchers shall contain full particulars of each service’’ and that ‘’the provision of unconditional performance guarantee/security bond shall be a precondition for payment of mobilization fees’’.
The paid vouchers on this contract also confirmed that the sum of ₦728,600,125.00 and ₦86,784,993.75 has been paid to the contractor and the following abnormalities were noted:
(i) Amounts of N2,293,300.00 was paid from Bill No 1 (General item 1.10) in the BOQ directing the contractor to pay the said amount to Messrs East consult for the partitioning of some offices in the PMS Directorate, to be funded from Bill No 1 of Dredging/Desilitng of Obano Okposha (Lot 2) Oguta Imo state was expended on purposes other than that for which the funds were provided, contrary to the provision of Financial Regulation 417 which stipulates that “Expenditure shall strictly be classified in accordance with the Estimates, and Votes must be applied only to the purpose for which the money is provided. Expenditure incorrectly charged to a vote shall be disallowed”.
(ii) There was no evidence of any need assessment undertaken for this project, in violation of the Public Procurement Act, 2007 and Financial Regulation 2918(a) which require that the Procurement Planning Committee shall prepare the needs assessment and evaluation of all procurements.
(iii) There was no evidence of adherence to due process and the Public Procurement Act, 2007 requirement by the commission before the award of this contract to Messrs Riverbrook Energy Ltd. Evidence of Newspaper advertisements, open competitive bidding, evaluation and acceptance of bid before award was not produced for audit verification, See Internal memo dated 21st March, 2017 on IPC No 3 folio 7 that the award was still being harmonized as at 30th March, 2017 thereby rendering this expenditure doubtful.
(iv) “No-objection certificate” was not obtained from the Bureau of Public Procurement before payment was effected.
(v) Relevant supporting documents such as the Approving Authority Tenders Board minutes, Contract Agreement, invoices etc, were neither attached to the voucher nor produced for audit verification.

Risks
Due process may be grossly abused.
Total disregard to extant rules and regulations by Management can weaken the Internal Control System of the Commission.

Recommendations
(i) The MD/CEO should be sanctioned for breach of Public Procurement Act, 2007 and Financial Regulations meant to protect government interest.
(ii) The Managing Director should justify the over expenditure and misclassification of votes.
(iii) Acceptable explanation should be provided on the observations raise above; otherwise the total amount involved should be recovered and its particular forwarded to the Office of the Auditor-General for Federation for verification in accordance with Financial Regulation 3106.