Mulunga saved Namcor and country, ACC says
Namcor boss should not have skipped board
The anti-graft body has cleared the embattled Namcor boss, saying his intentions were not corrupt.
“It was a matter where the [managing director] had to take a hard decision to safeguard the contract and avoid financial loss for Namcor and the country.”
This is the damning conclusion the Anti-Corruption Commission (ACC) made after its investigation into a N$100 million transfer actioned by National Petroleum Corporation of Namibia (Namcor) managing director Immanuel ‘Imms’ Mulunga.
The money was paid to Angola for equity in two oil blocks in that country.
In March, the ACC issued a summons for Mulunga to provide it with documentary evidence relating to alleged irregularities around the payment. Individual Namcor board members were also summoned to give their version of events.
The money was paid on behalf of one of the partners in Sungara Energies, a joint venture owned by Namcor, Sequa Petroleum and Petrolog Group. It is through Sungara that the three partners intend to acquire the oil blocks from Angola’s state-owned oil entity, Sonangol.
Namibian Sun understands that Sequa’s payment to the joint venture was delayed and Namcor was asked to pay on its behalf due to looming deadlines, with a view to refund the Namibian oil company.
By that time, Namcor had already deposited its own money into the joint venture – meaning N$100 million was being paid for Sequa.
Mulunga sought approval from the Namcor board, but directors “kept deferring the discussions and decision in the matter”, ACC found.
“The managing director was not given approval by the board when he authorised the transfer of the money to Sungara Energies. He, however, did so in the interest of Namcor and the country...” an ACC report read.
Rock and a hard place
The ACC investigation found that Mulunga found himself between “a rock and a hard object” when he discovered that the joint venture partners did not have enough money to honour the deal – for which Namcor had already paid its own deposit.
This situation put Sungara at risk of defaulting and fumbling the agreement with Sonangol.
“Failure to pay the full deposit within the timeframe specified in the sale and purchase agreement would result in a breach of contract, and Sonangol would have the right to terminate the [agreement] and still hold Sungara Energies liable for the US$22.6 million deposit payment,” the report read.
“This was the situation the managing director found himself in, and he had to strike a balance between foregoing the contract and facing the consequences - which could have been disastrous - or saving the contract by taking a hard decision without the blessing of the board.”
“What was at risk is that, had the initial payment not been made, the financial loss to Namcor and Namibia could perhaps have been ghastly,” it read.
The ACC said both Mulunga and the board would not have been able to avoid criminal investigations had the deal - in which state resources have been pumped - collapsed. Lawsuits and other fights would also have damaged neighbourly relations between Angola and Namibia, it said.
Rapped over the knuckles
Despite these justifications, the ACC did not give Mulunga a clean bill of health.
It rubbished his claims that as a director in Sungara, representing Namcor’s interest in the joint venture, he was empowered without limit to make decisions without board approval.
“That is a blatant and baseless excuse. The board could not have been so naïve to give him unbridled powers to deal with the finances of Namcor without the approval of the board,” the anti-graft body said.
The ACC report further indicated that board members were reluctant to approve paying N$100 million on behalf of Sequa because of the risk of recovery.
This is the damning conclusion the Anti-Corruption Commission (ACC) made after its investigation into a N$100 million transfer actioned by National Petroleum Corporation of Namibia (Namcor) managing director Immanuel ‘Imms’ Mulunga.
The money was paid to Angola for equity in two oil blocks in that country.
In March, the ACC issued a summons for Mulunga to provide it with documentary evidence relating to alleged irregularities around the payment. Individual Namcor board members were also summoned to give their version of events.
The money was paid on behalf of one of the partners in Sungara Energies, a joint venture owned by Namcor, Sequa Petroleum and Petrolog Group. It is through Sungara that the three partners intend to acquire the oil blocks from Angola’s state-owned oil entity, Sonangol.
Namibian Sun understands that Sequa’s payment to the joint venture was delayed and Namcor was asked to pay on its behalf due to looming deadlines, with a view to refund the Namibian oil company.
By that time, Namcor had already deposited its own money into the joint venture – meaning N$100 million was being paid for Sequa.
Mulunga sought approval from the Namcor board, but directors “kept deferring the discussions and decision in the matter”, ACC found.
“The managing director was not given approval by the board when he authorised the transfer of the money to Sungara Energies. He, however, did so in the interest of Namcor and the country...” an ACC report read.
Rock and a hard place
The ACC investigation found that Mulunga found himself between “a rock and a hard object” when he discovered that the joint venture partners did not have enough money to honour the deal – for which Namcor had already paid its own deposit.
This situation put Sungara at risk of defaulting and fumbling the agreement with Sonangol.
“Failure to pay the full deposit within the timeframe specified in the sale and purchase agreement would result in a breach of contract, and Sonangol would have the right to terminate the [agreement] and still hold Sungara Energies liable for the US$22.6 million deposit payment,” the report read.
“This was the situation the managing director found himself in, and he had to strike a balance between foregoing the contract and facing the consequences - which could have been disastrous - or saving the contract by taking a hard decision without the blessing of the board.”
“What was at risk is that, had the initial payment not been made, the financial loss to Namcor and Namibia could perhaps have been ghastly,” it read.
The ACC said both Mulunga and the board would not have been able to avoid criminal investigations had the deal - in which state resources have been pumped - collapsed. Lawsuits and other fights would also have damaged neighbourly relations between Angola and Namibia, it said.
Rapped over the knuckles
Despite these justifications, the ACC did not give Mulunga a clean bill of health.
It rubbished his claims that as a director in Sungara, representing Namcor’s interest in the joint venture, he was empowered without limit to make decisions without board approval.
“That is a blatant and baseless excuse. The board could not have been so naïve to give him unbridled powers to deal with the finances of Namcor without the approval of the board,” the anti-graft body said.
The ACC report further indicated that board members were reluctant to approve paying N$100 million on behalf of Sequa because of the risk of recovery.
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