Katti’s ‘magic’ leaked

LEAKED emails sent by serial oil speculator Knowledge Katti reveal how he boasted of his ability to use political connections to “do the magic” with officials.

Katti, President Hage Geingob’s friend and financier, is so close to some politicians that his former business partners claim he bragged to them, saying he has the ministers in his pockets.

The media has over the years reported on how Katti profited from the perception that Namibia has oil deposits.

Now, leaked documents and emails seen by The Namibian and the amaBhungane Centre for Investigative Journalism in South Africa, shed light on his operating style.

The documents revolve around a joint venture Katti entered into with South African tycoon Mxolisi Mbetse to explore three Namibian oil blocks.

Katti later persuaded the South Africans to part with their majority stake, and then sold it to a Canadian energy company – allegedly behind their backs.

The emails show that Katti used the help of state officials to legitimise his plans to make a quick buck from the sale of the oil blocks. The leaked communications also show how he met some state officials at night, and promised to use political influence to apparently keep his insiders in key government positions.

Katti first met South African investment millionaire Mbetse around 2003. Mbetse was already in the oil business, and often accommodated Katti at his houses in Cape Town and Johannesburg.

Around 2004, Katti approached the South African about an oil deal in Namibia, a person familiar with the story said.

The two partnered in a company registered in September 2005 called the Namibia Industrial Development Group (NIDG), which included Mbetse’s Industrial Development Group with 70%, and two Katti-owned companies, Cumoxi Investments and Knowledge Resources, which had 30%.

Former mines minister Erkki Nghimtina announced on 23 September 2006 that a black-owned empowerment firm, the NIDG, had been awarded exploration rights on onshore blocks 2815, 2195 and an offshore block, 2816, to prospect for oil in Namibia with a three-year licence.

The joint venture was on the verge of losing three oil blocks in June 2008 because it had not paid licence fees, and also failed to carry out exploration work.

The government gave the company until August 2008 to invest, or risk losing the concessions.

In an email to his South African partners, Katti suggests that he would convince the government not to cancel the NIDG’s exploration licence.

“I will hit them with the following: I will announce the UNX-Cumoxi deal immediately. Then use some funds to work the magic.

“But then you have to as soon as possible finalise your negotiations and sign with them quickly – pay the outstanding fee, then I will tell them here to back off,” he said.

It is not clear what he meant by magic since Katti did not respond to detailed questions sent to him on Monday.

Katti persuaded his South African partners to move their 70% interest in NIDG into a Namibian shell company he controlled.

He then sold the oil blocks to the Canadian firm UNX Energy Corp, allegedly without consulting his South African partners.

UNX later sold the blocks to Brazilian oil firm HRT in a deal that his partners claim enriched him to the amount of over N$60 million in cash and shares, without giving his partners “a cent”.

Insight Magazine reported in 2010 that the Bank of Namibia’s Financial Intelligence Centre, known as the anti-money-laundering unit, kept a close watch on Katti’s bank transactions after the businessman sold the oil blocks.

Mbetse confirmed to The Namibian on Sunday that there is a dispute over the oil blocks.

“The issue is being looked at by our auditors and some forensic experts. I cannot directly comment on this issue,” he said.

TIGHT-LIPPED

In the leaked data, Katti tells his South African partners that they should have no contact with any Namibian government officials, and should refer all questions to him.

“Don’t take any call from the Ministry of Mines and Energy. There is serious pressure on our block(s),” Katti says in an email on 24 June 2008.

“You will be on speaker phone, and will be recorded. Once you confirm the above (owing money and not funding the project), then it is over.”

He said he would not let their joint venture down.

“I will not disappoint IDG [Mbetse’s company], nor will I allow them to expose the inside(r),” he said.

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