First Lady’s Trust fleeced Oil companies $1.2m

Gertrude Mutharika

Former spokesperson of the Treasury Nations Msowoya has alleged that foreign oil companies have given the Beautify Malawi Trust run by First lady Gertrude Mutharika at least $1.2m.

Mutharika became president in 2014, in exchange, that the DPP government should shield them in investigations that they paid $1.2 million of kickbacks to Malawi’s former President Joyce Banda Trust.

Nations Msowoya
Msowoya: Madam Mutharika is using her influence to derail an investigation.

Msowoya said Madam Mutharika is using her influence to derail an investigation by the government-run Anti-Corruption Bureau into the awarding of six oil and gas exploration licences on Lake Malawi.

“There is no record of the monies because it came in cash to me and I hand delivered it to her Trust’s officials. It might be one of the reasons why the investigations have stalled. BEAM is benefiting from the same benevolence,” Msowoya said.

Msowoya also alleges that there have been spirited pressure from State House on the Anti Corruption Bureau (ACB) to drop investigations on the oil companies.

Banda awarded the licences to several foreign oil and gas companies: South Africa-based Sac Oil (later changed name to Efora Energy, “Energy for Africa”, British firm Surestream Petroleum, RAK Gas of the United Arab Emirates, and Seychelles-based Pacific Oil. Egyptian company Hamra Oil later bought Surestream’s concession.

JSE-listed Efora Energy, formerly trading under SacOil Holdings, announced in November 2017 that it had suspended oil exploration on Lake Malawi saying the prospectivity did not meet project investment criteria. SacOil initially acquired the licence in December 2012.

However, Bright Molande director of communications at State House, said that pressure from State House “may not necessarily mean the Presidency; we have to be careful”.

While President Peter Mutharika’s press aide, Mgeme Kalirani, saidthe First Lady and her foundation have never received funding or interacted with any oil company in Malawi or elsewhere.
“These are wild and malicious allegations composed and peddled by ill-minded individuals against the noble character of the First Lady, Madam Dr Gertrude Mutharika,” Kalirani said.
He added that paying attention to the claims of the “ill-minded individuals” at State house was a waste of time.
The oil saga began in 2009[1] , when the government divided Lake Malawi into six segments for oil and gas exploration.

It subsequently awarded block 1 to Sac Oil of South Africa, blocks 2 and 3 to the British firm Surestream Petroleum Blocks 4 and 5 went to RAK Gas, the parastatal oil company of Gulf state Ras al Khaimah, and block 6 to  [2] Pacific Oil. Hamra Oil later took over Surestream’s concession.

In their licence applications, the six companies pledged to pay a combined total of $1.2 million ($200,000 each) per year to former president Banda’s Mudzi Transformation Trust, according to documents seen by our reporter at the department of mining[3] (Petroleum Secretariat).

And in the lease agreements warehoused [4] at the department of oil and mining, which we haave seen, the oil companies also pledged $200,000 each for corporate social responsibility spending, heavily weighted towards such beneficiaries as Banda’s Safe Motherhood Project and Mudzi trust, which built and renovated houses for the poor.

According to high-level sources Including Msowoya, all the companies met their obligations in 2014, paying the Mudzi trust the agreed amount of $200 000 each.

With Banda now out of power and living in exile, sources alleged that after 2015 the cash trove has been diverted to Beam.

Ironically, Banda, who has been holed up in exile since 2014, is trying to help President Mutharika build support for his 2019 presidential campaign in exchange for dropping charges against her.
A source in the ministry of mines [5] corroborated Msowoya’s allegations saying when Banda fled into exile, the oil companies were ordered to redirect their annual pledges to Beam.

“They all obliged since this was one of their pledges when applying for the oil concessions,” said the source.

Spokesperson to Former President Joyce Banda, Andekuche Chanthunya said in a telephone interview that the DPP government was hell bent on persecuting the former President for political reason.