Jonathan, Shell, Etete, in fresh N155billion scandal
President
Goodluck Jonathan
President
Goodluck Jonathan
The
Federal Government is enmeshed in court cases in the U.S. and UK over a curious
$1.1bn (about N155 billion) payment made to a company belonging to former oil
minister, Dan Etete
Four years
after he was convicted of money laundering in France, Dan Etete, a former
Petroleum Minister, through his company Malabu Oil, has become a billion dollar
richer, courtesy of the Nigerian Government and Shell. According to documents
(filed March 22, 2012) before the Supreme Court of the State of New York in the
US, President Goodluck Jonathan discreetly approved the transfer of the sum of
$1.1bn to Mr. Etete on April 29, 2011, two weeks after he was re-elected.The
money was first paid to the Federal Government by two multinational oil
companies: Nigeria Agip Exploration Limited (Agip) and Shell Nigeria
Exploration and Production Company Limited (Shell) in respect of oil block OPL
245.
But
shortly after the funds were credited to the Federal Government's account, Mr.
Jonathan ordered that it should be secretly transferred to a London account of
Mr. Etete's company, Malabu Oil.
It is not
clear what deal Mr. Jonathan struck with Malabu, and on what basis the payment
was made. President Jonathan's spokesperson, Reuben Abati did not answer or
return calls seeking his comment for this story. He also did not respond to a
text message sent to him for the same purpose.
The
government made the payment to Mr. Etete’s company even when it had repeatedly
insisted that the award of the oil block to Malabu was done in violation of
laid down procedures.
Shell
insisted it had no knowledge that the government passed the funds to Mr.
Etete's company.
OPL 245:
History
While
serving as Petroleum Minister under late Head of State, Sani Abacha, Mr. Etete
awarded his own company, Malabu, an oil block, OPL 245 in 1998.
The
allocation was however reversed by the Federal Government under President
Olusegun Obasanjo in 2001 when the FG described the allocation process as dubious.
The block was allocated to Shell in 2002. Following the revocation, a prolonged
legal battle ensued with Malabu taking the Federal Government to court. In
2006, the Federal Government reversed itself and re-allocated the oil block to
Malabu. This angered Shell which then filed arbitration proceedings in
Washington.
Following
the protracted legal battles, an agreement was reached between all parties.
The
agreement
In an
agreement titled “Block 245, Malabu resolution agreement” dated April 29, 2011
between Malabu and the Federal Government, the FG agreed to pay Malabu
$1,092,040,000 in “full and final settlement of all its claims, interests or
rights relating to OPL245.” The agreement also stated that the rights to the
oil block would be reallocated to Agip and Shell.
In a
separate agreement between Shell and Nigeria, titled “Block 245 resolution
agreement,” the two multinationals (Agip and Shell) agreed to Pay the same sum
“for the purposes of FGN settling all and any existing claims and/or issues over
Block 245…” In other words, the multinational oil firms agreed to pay $1.1bn to
the FGN with the knowledge that the money would be used to settle any existing
claims that existed by any other party to the oil block.
We didn’t
pay to Etete
Despite
knowing that the money was to be paid as settlement to a third party and
knowing that Malabu was the only company with bragging rights over the oil
block, Shell claims it did not know the money was to be paid to Mr. Etete’s
Malabu.“Shell was not aware that that money was to be paid to Malabu,” said
Precious Okolobo, a communications officer with the oil company in a telephone
interview.
Mr.
Okolobo confirmed in a follow-up email that the “the Federal Government of
Nigeria has allocated the deepwater offshore block OPL 245 jointly to Nigeria
Agip Exploration (NAE) and Shell Nigeria Exploration and Production Company
(SNEPCo),” and that “each now holds 50 percent in OPL 245, with NAE as operator
of the block.”
“Any payments relating to the issuance of the license were
made only to the Federal Government of Nigeria,” the Shell official said saying
“in line with Shell's information policy, we cannot reveal commercially
sensitive information, and hence cannot comment further on the papers filed in
the New York court proceedings.”
The
American court case
Mr. Etete
‘s company is being sued in the United States for alleged refusal to honour an
agreement with ILC, a company registered in the British Virgin Islands. The
company claims it helped negotiate the agreement Malabu had with the FG and was
thus entitled to payment under “an engagement letter and fee agreement” it
signed with Malabu on January 19, 2010. “ILC contends that it fully performed
its obligations under the fee agreement entitling it to a 6 per cent success
fee amounting to $65,522,400 and that Malabu has indicated that it will not pay
this amount,” the company told the court.
Another
company allegedly owed by Malabu over OPL 245 had also sued the company in the
UK which led to a court freeze of some accounts linked to the company and also
to Nigeria. The Federal Government, through the Attorney General of the
Federation, Mohammed Adoke had objected to the freezing of its account in a
letter dated July 16, 2011 to the court saying “the FGN does not submit to the
jurisdiction of the English courts and that this letter is sent only to claim
immunity.
A history
of corruption
Mr. Etete,
who served as minister between 1995 and 1998, was convicted of money laundering
in France in 2007. He was sentenced to three years in prison and given a fined
$300,000. He was also asked to pay $150,000 to the Nigerian Government. The
former Minister appealed the ruling. In March 2009 however, a French appeal
court confirmed the money laundering charges against Mr. Etete, and fined him
$10.5 million after conviction. Apart from money laundering and his
controversial in oil block dealings, Mr. Etete is also believed to be a major
beneficiary of the Halliburton bribe where $180 million dollars was paid as
bribe to senior government officials by a consortium including a subsidiary of
an American company, Halliburton.
Mr. Etete
was an ally and business associate of Jeffery Tesler, the British middleman who
coordinated the bribe scheme and who was recently convicted in the United
States for his role in the bribe payment. Neither Mr. Etete nor any other
Nigerian has been convicted for the collection of the bribes; though the
companies that made the payment and the middlemen have all been convicted or
indicted in the United States and other host countries.
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