Namcor axe lands on Mulunga

The National Petroleum Corporation of Namibia has fired managing director Immanuel Mulunga.

He was accused of committing fraud by holding information from the company’s board, and that he breached conditions of his employment when he transferred funds for the purchase of an oil block in Angola. Mulunga directed that an amount of US$6.7 million (over N$180 million) be paid from the bank account of Namcor E&P to Sungara Energies Limited, charges for which he was vindicated by an earlier investigation. The payment was part of the deposit for the acquisition of 10% interest in block

06/15, as well as two exploration blocks.

Sungara is a corporate entity incorporated in the UK, jointly owned by Namcor Exploration and Production (Pty) Ltd, Petrolog, and Sequa with equal shareholding. Sungara entered into a Share Purchase Agreement (SPA) with Sonangol to purchase a 10% stake in the Block 15/06 producing asset as well as participating in interest in two exploration blocks, a strategy that led to Sungara winning the bid for the advertised producing asset.

However, late yesterday, the Namcor board issued a statement that it severed ties with the seasoned executive.

“The board of directors of the National Petroleum Corporation of Namibia at its meeting held on 8 August 2024 deliberated on an ongoing case of misconduct relating to the unauthorized asset acquisition by the suspended managing director, Mr Mulunga,” reads the statement.

The board then dropped the bombshell.

“Following extensive deliberations, the board resolved to terminate the services of Mr Mulunga with immediate effect. The board believes that the misconduct by the managing director is of a serious nature and warrants the decision taken. The board is committed to ensuring a smooth leadership transition and will provide further updates as necessary,” read board said.

An independent hearing was conducted and chaired by Gerhard Maritz, a retired Supreme Court judge.

Maritz, who signed a document seen by New Era dated 7 August 2024, said
Mulunga exercised his powers within the limits of his authority, and for the purpose for which they had been conferred.

“The scope of the authority conferred on the employee by the employer’s board is so wide that the employee was entitled to assume that he was acting within the scope thereof. “He did not seek to surreptitiously hide his intentions and instructions from him, but openly conveyed it to employees in the form of directions to be implemented,” Maritz found. The retired judge added that the count of fraud by holding information is clearly based on an alleged omission on the part of the employee, not on the commission of a fraudulent misrepresentation.

In August 2022, the board said Mulunga, without the necessary approval of the board, caused an amount of US$6.7 million to be transferred from the account of Namcor E&P to an account of Sungara Energies Limited, a company incorporated in England and Wales, and which account is held with Mauritius Commercial Bank Ltd., Port Louis, Mauritius. However, the company claimed that Mulunga was supposed to disclose his intention about the transfer of funds before, and not after he gave the instruction for payment to the finance executive. The board was faced with a situation where an additional US$6.7 million was transferred to Sungara in circumstances where it previously only approved the transfer of US$10 million instead of US$16.7 million to Sungara in respect of an approved business transaction by the board for an investment of only US$10 million in Sungara. He just acted to avoid Sungara and subsequently Namcor losing out on this very lucrative and game-changing transaction, Maritz found.

Confidentiality

The third charge Mulunga faced was of breach of confidentiality.

The document stated that Mulunga, during March 2023, caused confidential WhatsApp communication by Namcor board chair Jennifer Comalie to be leaked to the press. Thus, the company claimed Mulunga breached some clauses of his contract of employment, causing material breach of trust. However, I have denied all the charges. In his defense of him, Mulunga said he directed the transfer to save the transaction.

“Cancellation of the transaction would have presented me, as MD of Namcor, the board and the Namibian government at large with serious reputational damage issues since Namcor’s successful bid was announced publicly both nationally and internationally,” he asserted.

He continued that the Namcor schedule of authority does empower the MD to approve direct financial assistance for business development activities for amounts above N$150 000. Mulunga was also appointed to represent Namcor in this transaction, and Maritz added that it is evident that he was authorized to sign the sale and purchase agreement.

In terms of the sale and purchase agreement, Sungara was required to pay the amounts recorded in the sale and purchase agreement. Contacted for comment yesterday, Namcor said the board is currently reviewing the chairperson’s determination before making any formal pronouncement on the matter. Mulunga could not be reached on his phone for comment yesterday.

Enercon

Mulunga last year faced another disciplinary harbinger for his alleged role in a N$53 million transaction between Namcor and military contractor Enercon.

His 2022 payment to Enercon would have allowed the national oil parastatal to take over the fuel supply contract and related infrastructure business with the Namibian Defense Force. Enercon had to cancel its agreement with Namcor due to military objections, but failed to repay the N$53 million immediately.