OPL 245: Italian court orders Shell, Eni to stand trial

An Italian judge yesterday ordered Royal Dutch Shell and Eni to stand trial over alleged corruption in Nigeria involving the award of OPL 245 seven years ago.
Apart from the two companies, 13 people including Eni CEO Claudio Descalzi his predecessor, Paolo Scaroni, and former chairman of the Shell Foundation Malcolm Brinded would be tried for their roles in the deal. The trial is set for March 5.
Italian prosecutors had earlier indicted Shell and Agip for their role in the 2011 messy deal in which Nigeria sold the juicy oil block to the two oil majors. Dan Etete, a former petroleum minister, and Bello Adoke, a former Attorney-General, are amongst several Nigerians indicted in the deal, which was approved by ex-President Goodluck Jonathan. Shell and Eni’s Nigerian subsidiary, Agip, are also among those already being prosecuted in Nigeria.
In 2011 Shell and Italian oil giant Eni paid $1.1 billion for OPL 245, an oil block located on the southern edge of the Niger Delta allegedly knowing that the money would go to a front company secretly owned by Dan Etete, who had been convicted for money-laundering.

Etete was accused of awarding himself the oil block while in office under the former military dictator Sani Abacha, through Malabu Oil and Gas, a company he owned.
Under Italian law a company can be held responsible if it is deemed to have failed to prevent, or attempt to prevent, a crime by an employee that benefited the company.
In a reaction to the judgement Shell said, “We are disappointed by the outcome of the preliminary hearing and the decision to indict Shell and its former employees. We believe the trial judges will conclude that there is no case against Shell or its former employees.
“Shell attaches the greatest importance to business integrity. It’s one of our core values and is a central tenet of the Business Principles that govern the way we do business. Shell has clear rules on anti-bribery and corruption and these are included in our Code of Conduct for all staff. There is no place for bribery or corruption in our company.”
Eni reiterated that the company and its CEO had not been involved in any wrongdoing. It said the board had full confidence in Descalzi who at the time of the deal was head of exploration and production.
Under president Buhari’s administration Nigeria has ramped efforts to recover the block and lost revenue on account of the deal. In October, Abubakar Malami, the Attorney General of Federation and Minister of Justice, said that Switzerland has agreed to return $321million that was looted from the national treasury by late military head of state Sani Abacha said to be part of the proceeds from the controversial Malabu oil deal scam.
U.S. banking giant, JP Morgan, was sued in November by Nigeria for $875million in the London courts over its alleged failure to block payments made from a massive oil deal that is subject to a string of international corruption investigations according to a Premium Times report.
The Nigerian state quietly issued a civil claim in the High Court in late November, arguing JP Morgan had been “grossly negligent” when it was banker to a previous government.
In April, Global Witness and Finance Uncovered revealed that Shell executives knew that $1.1bn they paid for OPL 245 would go to Dan Etete and were likely to be used in a vast bribery scheme. For years, Shell has claimed that it only paid the Nigerian Government.

But after Global Witness investigations Shell shifted this position and acknowledged it had dealt with Etete, through his front company Malabu. Dan Etete was convicted of money laundering in France in 2007. Etete had awarded his own company the OPL 245 oil block while oil minister during the rule of former dictator Sani Abacha.
In December, the Milan Public Prosecutor alleged that $520 million from the deal was converted into cash and intended to be paid to the former president Goodluck Jonathan, members of the government and other Nigerian government officials.
OPL 245 holds significant discovered hydrocarbon reserves and will increase Shell’s reserves by a third. Two oil and gas discoveries have been made on the block. Etan and Zabazaba were discovered in 2005 and 2006 respectively. Eni plans to develop the Etan and Zabazaba fields in phases with subsea wells tied back to a leased floating production storage and offloading (FPSO) vessel.

 

ISAAC ANYAOGU