7 June 2018

Liberia: Why Ex-President Sirleaf May Not Be Liable for Bonuses in Exxon Block 13 Deal

Monrovia — When the Presidential committee set up to probe the recently-released Global Witness "Catch Me If You Can" report alleging that the National Oil Company of Liberia(NOCAL) made unusual, large payments to senior government officials who authorized the 2013 US$120 million deal, it sought the help of NOCAL particularly regarding the Article of Incorporation containing the names of the original shareholders and the extent if any of former President Ellen Johnson-Sirleaf regarding authorization of some US$500,000.00 in bonuses to key members of the board and other staffers.

That inquiry, according to a communication in possession of FrontPageAfrica and the committee's report came up empty.

'Documents Cannot be Traced'

Marilyn T. Logan, the officer in charge at NOCAL in an undated communication wrote: "Kindly note that the below listed documents can not be traced at the moment: Presidential Communication granting approval to the Board Resolution and the Articles of Incorporation filed with NOCAL as part of their application for concession permit for Oil Block 13."

A FrontPageAfrica report this week citing a board resolution dated April 27, 2013 suggested that former President Ellen Johnson-Sirleaf gave the approval for the payment of US$500,000 in bonuses to senior and junior executive members of the oil company involved in the controversial Production Sharing Contract negotiations for LB-13 with ExxonMobil.

Sirleaf reportedly did not appear before the committee due to some miscommunication. Sources tell FrontPageAfrica that on the day the former President was to appear she was informed by the committee that the current President had passed an instruction for her not to appear. However, when members of the committee brought the issue to President Weah during the presentation of their report to the president, he reportedly told them, he never instructed the former president to skip the committee's inquiry.

The Board Resolution signed by both former CEO Dr. Randolph McClain and former Board Chair Robert Sirleaf stated:

"Regarding the proposal that was approved by the President of the Republic of Liberia to use approximately ten percent of the income that NOCAL generated from the LB-13 transaction (which amounts to approximately Five Hundred Thousand United States Dollars) for the payment of bonuses to the Hydrocarbon Technical Committee and Support Team, the Board of Directors, Management and Staff of NOCAL for their hard work and dedication to ensuring the successful completion of the project."

At the April 27th 2013 meeting, the board resolved that payments be made to not exceed US$500,000 USD.

The Resolution noted: "The Board of Directors hereby authorizes the President/CEO to disburse bonus payments in an amount not to exceed Five Hundred Thousand United States Dollars ($500,000 USD) in order to pay bonuses to the Hydrocarbon Technical Committee and Support Team, the Board of Directors, Management and Staff of NOCAL for their hard work in accordance with the payment listing that was approved by the Board and is attached to this Resolution. The undersigned, acting by consent of the Board of Directors (the "Board") of the National Oil Company of Liberia(NOCAL), a company duly organized and existing under the laws of the Republic of Liberia (herein referred to as the "company"), do hereby certified that during an emergency meeting of the Board of Directors was present, the following resolution was unanimously adopted in full force and effect as the date hereof."

The board minutes added: "Whereas the Government of Liberia, led by NOCAL, successfully concluded negotiations with Exxon/Mobil and Canadian Overseas Petroleum Ltd. (COPL) and signed a Revised Production Sharing Contract(PSC) for Liberia offshore block LB-13, which garnered an income of Fifty Million United States Dollars ($50,000,000.00) for the nation. The agreement will provide immense benefits to the nation and its people, including immediate and long-term financial benefits, strong social and environmental protections, a high royalty rate, state and citizen participation, as well as provisions to promote local content and job creation in Liberia."

But that document according to the Special Presidential Committee was deemed unacceptable to their investigation.

In its findings presented to President Weah which is now in FPA's possession, the committed wrote: "During its investigation, the Committee was presented a document purporting to be a Resolution of the Board of Director's in which it was alleged that the payment of these bonuses/honoraria, as proposed and approved by the Board receive Presidential approval. The committee does not accept this submission."

The Committee emphasized that one pillar of its investigation was the Five Hundred Thousand United States Dollars (US500,000.00) approved by the Board of Directors for payment as bonuses/honorariums even though the amount ultimately paid out by the Management of NOCAL was a little over Five Hundred Thousand United States Dollars."

Explaining why it did not accept the board resolution signed by both the former Chair of the Board Robert Sirleaf and former CEO, Dr. Randolph McClain, the committee noted that although the resolution claims that President Sirleaf approved the payment for bonuses/honoraria, it found no records in the annals of NOCAL which suggests that indeed the former President approved the bonuses in the amount of half a million dollars to employees of NOCAL and others. "The committee is not persuaded by the submission that the President of the Republic would authorize the payment of half a million United States Dollars by mere word of mouth in contravention of the Public Finance and Management Act(PFMA) of Liberia. The Committee, therefore, concludes that the insinuation of a presidential approval is mischievous and intended to misrepresent the former President of Liberia."

The committee further noted that on January 6, 2012, the former President, in exercise of her constitutional authority, issued Executive Order #38 titled "Receipt of Double Emoluments", section 9, 10 of which provides as follows: "A public servant shall not, while receiving or being paid salaries by any public office, at the same time receive or be paid salary to other institutions, including service on the boards, on account of a duty required by the government, shall not demand and receive other benefits for such service."

NOCAL Board 'Contravened Executive Order'

The committee noted that given the strong wording in the Executive Order, it was convinced that the President and the government intend to give full effect to Article 90b of the Constitution, and could not, within the same period make decision that appears to defeat the spirit and intent of Executive Order No. 38 and Article 90b of the Constitution.

The committee further explained that even during the twelve calendar months that the Executive Order was in full force and effect, the Board of Directors of NOCAL continued to make decisions that were contrary to the laws and the policy of government. "For instance, the Board of Directors of NOCAL continued to approve and pay other "benefits" to public servants during that period. To illustrate, during the period that Executive Order 38 was in full effect, Hon. Augustine Ngafuan was paid the sum of Sixty-Five Thousand Three Hundred Ten United States Dollars and Eighty-Six Cents(US$65,310.86); Hon. Amara Konneh was paid Twelve Thousand Three Hundred Fifty-Six United States Dollars(12,356); Hon. James Kollie was paid Eleven Thousand Five Hundred Thirty Four United States Dollars and Fifty Cents(11,534.50); Hon. Seward Cooper received Fourteen Thousand Two Hundred Thirty United States Dollars and Forty Eight Cents(14,230.48); Hon. Christiana Tah received the sum of Seven Thousand Five Hundred Seventy United States Dollars($7,570)."

The committee clarified that the named individuals are not being singled out with any prejudice, and the list is not exhaustive of al the serving government officials to whom NOCAL paid benefits during the period when the Executive Order was in full effect. "These indications are only to demonstrate the obvious resolve of the Board of Directors of NOCAL to recklessly disregard the law. And for the examples shown, the Committee is satisfied that the decision of the Board of Directors to pay Five Thousand United States Dollars in Bonus/honorarium is not considered nor prudent."

A few of those named in the report have dismissed the categorization of the bonuses as bribes.

Last week, following the release of the report, Mr. Robert Sirleaf countered that he was not aware of any discussion relating to the payment of a "bonus" during the negotiations with Peppercoast, COPL or Exxon-Mobil. "It is my recollection that in late April of 2013, about a month after the completion of the landmark oil and gas exploration agreement between the National Oil Company of Liberia (NOCAL) and ExxonMobil-COPL, the CEO of NOCAL recommended to the NOCAL Board of Directors that members of the Hydrocarbon Technical Committee ("HTC" - the interagency committee established under the then existing Petroleum Law to assist NOCAL in the negotiation of petroleum exploration and development contracts), the technical support team, and NOCAL's senior officers deserved the payment of a bonus "for the hard work and dedication to ensuring the successful completion of the transaction."

Sirleaf, Konneh Denial

Robert, the son of former President Sirleaf said subsequently, the Board of Directors under his chairmanship agreed that the recommendation of a payment of bonus was reasonable. "Though I stressed ONLY so long as all NOCAL employees (i.e. from the President/CEO down to the drivers, janitors, secretaries and clerks) received a bonus. This approval was consistent with Section 3 (g) of the NOCAL Act of 2000 - "To take any and all actions determined by the Board of Directors to be necessary or desirable to carry out the functions of the Corporation." and Section 8 (e) - "To set the stipend to be received by the members of the Board of Directors." and (f) To set the salaries, benefits and other compensation to be received by management of the Corporation."

Former Finance Minister Amara Konneh for his part, challenged NOCAL to make the list of all the recipients public. "I call on NOCAL to release to the public the full list of everyone who received bonus payment from the Exxon negotiation."

The former Finance Minister insisted: "While I accepted the bonus through an official NOCAL check as did all others, I, Amara M. Konneh, as Minister of Finance and Development Planning at the time, did not solicit or request a bonus or any other payment for the work that I did for the benefit of my country's oil burgeoning hydrocarbon program. Furthermore, I served as Minister of Finance from February 2013 to April 2016 and during and after my term of service, I did not at any time solicit or receive money or favor from corporations or individuals seeking relationship with the Government of Liberia."

On July 16, 2014, the former Finance Minister in a letter to the NOCAL CEO raised concerns about the breach and returned a number of board fee checks while citing Section 9.10 of the Code of Conduct.

The minister wrote: "In view of the above, I am herewith forwarding cheque No. A00007000 representing fuel benefit for the month of May in the amount of two thousand, seven hundred twenty-three United States Dollars and Fifty-Seven Cents)US$2,723.57) dated May 22, 2014; cheque No. A00007247 representing quarterly fee in the amount of Four Thousand Five Hundred United States Dollars(US$4,500.00 dated June 27, 2014 and; cheque No. A00007239 representing fuel benefit for the month of June in the amount of Two Thousand Seven Hundred Twenty Four United States Dollars and Seventy-One Cents(US$2,724.71) dated June 27, 2014."

In its report, presented to President Weah recently, the presidential committee concluded that there is not other instance on record in the history of NOCAL where the President of Liberia was required to grant approval to Resolution of the Board of Directors. "This was confirmed by members of the Board of NOCAL who appeared and testified before the committee. Accordingly, it appears strange that for this particular transaction, the approval of the President was requested, and allegedly obtained."

Ironically, the committee said the minutes of the alleged Board meeting during which the decision was taken was not available for inspection; as a result, the Committee was unable to determine whether the vote count in support of the decision to pay bonuses were etc.

The committee said during its examination, it informed the board chair at the time, Mr. Robert A. Sirleaf, that the minutes of the particular meeting during which the resolution to pay the bonuses/honoraria was allegedly taken could not be located by NOCAL. "He(Robert Sirleaf) advised that the minutes were recorded by Madam Idella Cooper-Shannon, member of the Board of Directors, and suggested that the Committee contact her for a copy of the minutes.

The report however noted that the committee was informed by Madam Cooper in a telephone conversation that she did not have any records of the minutes in her computer database, which is an indication to her that she was not at that particular meeting. "If the meeting was ever held, or that the meeting was held and nobody was available to make minutes of the proceedings. She also informed the Committee that she was probably out of the bailiwick of Liberia during the period when the Board meeting was allegedly held."

Committee: 'No Such Meeting Took Place'

The committee then concluded that it was constrained to believe that no such regular or emergency meeting of the Board of Directors of NOCAL may have been convened and held to discuss and approve the payment of bonus/honoraria to sundry persons connected with NOCAL.

The committee report that it was informed by Mr. Sirleaf that the decision of the Board to authorize the payment of bonuses/honoraria to members of the HTC and members of the Board was based on a certain opinion issued by the Minister of Justice and Attorney General of the Republic of Liberia at the time, Hon. Benedict F. Sannoh. However, the committee said it rejected the contention because the former minister's opinion was issued on August 12, 2015, and could not have been the basis for authorizing payment of the bonuses/honoraria that was made in April 2013. "The opinion of the AG was largely focused on Section 9.10 of the2014 National Code of Conduct, and the question of Conflict of Interest which is not primary to the mandate of the committee."

In 2015, Sirleaf took the blame for the managerial and financial difficulties at NOCAL . "As the head of the country you have to take responsibility even though you have a very able Director and a very able senior management I entrusted to make the decision on behalf of the company. As the head of the country anything that does not work the way we want I ultimately will be responsible," the President told reporters upon her return from Japan, where she had gone to deliver the keynote address at the opening of the 2nd World Assembly for Women (WAW 2015).

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