Imagine for a second that a country has floated an open tender inviting foreign companies to bid for a gas field exploration in joint partnership with a state-run company. An intense competition among global bidders takes place and an evaluation by international experts ranks these competitors. But with a change in government, the least qualified bidder ends up getting the contract. A bribery scheme of the least qualified bidder manages to buy allegiance of those closely connected to the son of the prime minister. The company is granted rights to explore a new gas field by classifying it as an abandoned gas field. When the company starts drilling work, two massive blowouts occur. Those blowouts that happened in 2005 are still having a devastating impact on local peoples’ livelihoods and have eventually cost the country over $1.06 billion. It all happened during the tenure of the then BNP-Jamaat government.
Niko Corruption: Bribes to loyalists again brings Tarique’s influence to the fore
“My power is fifty percent, I’m the friend of Tarique Rahman.” This is what Giasuddin Al Mamon, friend and business associate of Tarique, told investigators of Royal Canadian Mounted Police (RCMP) regarding his role in facilitating contracts to Niko.
Contracts for sensitive work such as gas exploration were granted to Niko, which flouted rules with bribes – in the form of cash, expensive SUV, and lavish foreign trips. The money trail was tracked down by investigators from RCMP and the Federal Bureau of Investigation (FBI), exposing an intricate and complex web.
Court allows 3 foreigners to testify against Khaleda in Niko graft case
A recent hearing – from December 11-15 – at World Bank’s International Center for Settlement of Investment Disputes (ICSID) regarding the infamous Niko corruption issue – put the spotlight back on the blatant abuse of state power and influence to offer gas exploration work to the Canadian company in exchange of bribes to influential people linked with the then BNP-led government, including those loyal to Tarique Rahman.
What is the Niko Deal?
In 1997, Niko entered Bangladesh during the second round Production Sharing Contract bidding for oil and gas exploration. But with just 10 years’ experience in the field, the firm failed to qualify in the bid both on technical and financial grounds. While Sheikh Hasina was in power, Niko was unable to acquire any interest in any gas field in Bangladesh. But in 2001, with the return of the BNP-Jamaat regime, Niko resorted to bribery and established a corrupt scheme by enlisting consultants and lobbyists with close connection to Hawa Bhaban and Tarique Rahman. With the assistance of Giasuddin Al Mamoon, close friend and business partner of Tarique Rahman, Niko managed to get contracts in Bangladesh through the use of political clout and abuse of power.
Niko graft case: Court frames charges against Khaleda
As testified by former FBI Special Agent Debra Bragg (formerly Debra LaPrevotte Griffith), Niko sought the Chhatak East gas field through a joint venture agreement (JVA). Niko entered into a consultancy agreement with Stratum, a company headed by Qasim Sharif, who later became president of Niko’s Bangladesh chapter. Niko agreed to give US$ 4 million to Stratum within 15 days of signing of the JVA. Qasim Sharif then entered into an arrangement with Selim Bhuiyan (former president of Dhaka Club). Niko documents show that it paid Selim for arranging meetings with government officials at Bapex, Petrobangla and the energy ministry. Selim admitted before a Dhaka court that he took the money and paid Giasuddin Al Mamoon.
Selim gave Tk 1.8 crore to Mamoon. “Mr Mamoon told me that he was taking the lion’s share of the money as Tarique Rahman was with him,” Selim said in a confessional statement.
According to government documents, the JVA deal with Niko, signed on October 16, 2003, was vetted by the then law ministry and approved by the then prime minister Khaleda Zia.
To illustrate the extent of bribery, the FBI agent, in her statement mentioned that the then Law Minister Moudud Ahmed’s wife purchased a $400,000 home in the United States. Moudud Ahmed’s government salary during this time frame was approximately $9,500 per year.
As the FBI and RCMP evidence shows, the corrupt syndicate linked to Tarique Rahman thus handed over the Chhatak gas field to the incompetent Niko in exchange of bribes.
The cost Bangladesh paid
When Niko started drilling the Chhatak field, it caused two massive blowouts – first in January 2005 and the second in June 2005 – due to its “faulty and negligent operation.” The gas field was completely destroyed and gas escaped from the field for years. This caused serious health issues for the local population as well as environmental damage to the surrounding areas. Eighteen years down the line, the residents of the area surrounding Tengratila gas field in Sunamganj are still reeling from the adverse effects of the blow-outs. International experts have estimated the loss and damage from the blowouts to be over $1.06 billion.
The writer is an Ekushey Padak-winning journalist and researcher. Views expressed are the writer’s own.