The office of the Auditor General (AG) is putting final touches on an audit of the management of the government’s fuel strategic stocks.
The AG, Evelyn Kamagaju, said yesterday that she would release her report to the office of Prosecutor General (PG) before the end of this month.

The investigation was launched last month at the request of PG Martin Ngoga, whose office is handling suspected corruption in the management of government’s strategic fuel reserves.

Kamagaju was however uncomfortable to admit that her institution was carrying out the audit as part of the ongoing investigations into suspected irregularities committed by  some senior officials in the Ministry of Commerce (Minicom).

"It is a normal audit. The request to audit the strategic reserves came at a time when we had already started auditing Minicom,” she said.

Commerce Minister Protais Mitali and his predecessor James Musoni (now Finance Minister) are among officials that were interrogated in connection with a suspicious 10-million-litre fuel tender worth Frw5 billion in 2006.

However, Kamagaju said that the her office’s audit of fuel records is not only confined to the management of the reserves but also covers the procurement process of the said fuel, which was however scaled down to four million litres (worth Frw2 billion) after the government received a fuel grant from the Japanese government.

She however declined to say whether there was a likely culpability on the side of those charged with managing the government fuel.
"I cannot report to the media before handing the report to relevant authorities,” she said.

Both ministers said the deal was initiated because the country was at the time threatened with a looming fuel crisis after local petroleum companies failed to supply the required volume.

While Ngoga cleared both ministers on the procurement process, it remains to be seen whether the AG’s decision to examine the process would not uncover anomalies worth special attention.

The fuel reserves management was not part of the original investigations carried out by the Criminal Investigation Department (CID) but later became a major component of the investigations when PG’s office took over the case.

"We established that there was a crisis (when the said fuel tender was conducted early 2006) and we are not disputing the way it was handled at the time.

However, now a major component of our investigations is to get to the gist of what happened in the management of fuel reserves during and after that period,” Ngoga said.

He said investigations showed that indeed Musoni contacted Rwanda’s Ambassador to Kenya Bill Kayonga instructing him to identify any company with capacity to supply the country with fuel, but did not dictate to him which petroleum firm to contact.

"What is questionable is not how the process started but rather how the deal was carried on after Musoni left that ministry, and how that fuel was later managed after delivery,” Ngoga said. Although he said Mitali out to have taken the matter to Cabinet for approval before singing the contract with Dalbit Petroleum Ltd (the supplier), the minister too had been cleared on the procurement part of the investigation.

Mitali recently admitted he "unwillingly” bypassed Cabinet and said he wouldn’t repeat the same mistake if a similar situation came up.

Kayonga told the prosecution during investigations that he was the one that picked Dalbit after other Kenyan firms showed no interest.
Musoni was then Commerce minister when the process was initiated but was appointed Finance minister in March 2006 and Mitali replaced him.

Others interrogated are Minicom Secretary General, Justin Nsengiyumva, the ministry’s director of planning and chairman of the internal tender committee, Felicien Murenzi and the in-charge of petroleum transactions, Robert Opirah.

Sources say the probe showed that most local fuel companies were unhappy with the way Minicom manages the government strategic fuel reserves.

The Auditor General’s office falls under the Finance ministry although it enjoys autonomy.

It officially reports to the Chamber of Deputies.

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