The Nigerian law enforcement agency, the Economic and Financial Crime Commission (EFCC) has charged the former Minister of Justice, Mohammed Adoke (2010-2015) and former Minister of Petroleum, Dan Etete (1995-1998) with money laundering. The case centres on the 2011 sale of the Nigerian oil license OPL 245, after years of investigation by NGOs Global Witness, Re:Common and Corner House into the deal.
“We applaud the Nigerian authorities for fighting back against corruption without fear or favour, making sure there are real consequences for taking part in shady deals like with OPL 245.” said Simon Taylor, Global Witness Director.
“This is a great step forward with the Nigerian authorities showing they are serious about tackling corruption. European and American law enforcement must also step up by fully cooperating and prosecuting anyone else culpable in this corrupt deal.” Said Nicholas Hildyard of Corner House.
The charges focus on the transfer of $801m in proceeds of the deal, facilitated by Adoke, into bank accounts controlled by Dan Etete. The charges were filed at the Federal High Court of Abuja on the 16th of December, according to court documents seen by Global Witness.
The lucrative OPL 245 oil block was allocated in 1998 for $20m – a fraction of its value now – to Malabu Oil & Gas, a company secretly owned by the then oil Minister, Etete. The block was eventually passed on to Shell and Eni in 2011 in exchange for a payment of $1.1bn which flowed to Malabu rather than to the Nigerian state. The former Minister of Justice, Adoke by his own account acted as a broker in the deal. This deal deprived the country of a sum equivalent to 80% of its 2015 health budget in a country where more than 60% of the population live in poverty.
Shell and Eni have always denied that they knew the money they paid would go to Malabu, but documents seen by Global Witness show that the companies in fact constructed the deal knowing that the money would flow ultimately to Malabu.
Prosecutors in the UK have previously alleged that $523m of Shell and Eni’s payment went to alleged “fronts for [former] President Goodluck Jonathan of Nigeria” as part of a deal that was effectively a “smash and grab” on Nigeria.
Shell and Eni are also under investigation by the office of the Public Prosecutor of Milan which has named Dan Etete, Shell, Eni and Eni’s current and former CEOs as suspects. Eni has “self-reported” to US authorities. In February 2016 Dutch financial police working in a joint investigating team with Italian authorities raided Shell headquarters in The Hague.
The OPL 245 block, off the coast of Nigeria is owned 50-50 by Shell and Eni and contains probable reserves of 9.23 billion barrels of oil, representing potentially massive bookable reserves for the companies. Shell currently holds 11.75 billion barrels of proven oil equivalent reserves and Eni holds 6.89 billion barrels of proven oil equivalent reserves.
In a statement, Mohammed Adoke said “I hope to at the appropriate time make myself available to defend the charge for what whatever its worth,” he also emphasized that he did not benefit from the deal, which he said saved the government from a breach of contract suit in which Shell was claiming $2 billion. He called the charges “orchestrated plans to bring me to public disrepute in order to satisfy the whims and caprices of some powerful interests on revenge mission.”
Shell has insisted that they did not pay Malabu directly and that all payments went to an escrow account held by the Government of Nigeria. In a response to a request for comment from Global Witness in April 2015, Shell said “We do not agree with the premise behind various public statements made by Global Witness about Shell companies in relation to OPL 245.” It has not responded to more recent requests to comment.
Eni responded to questions on the deal in May 2016 saying “Independent enquiries and the investigations commissioned by Eni’s Watch Structure and Board of Statutory Auditors from specialized American law firms have found no evidence of illegal conduct on the part of the Company.”
Antonio Tricarico of Re:Common said “The Italian Government must ask serious questions of the involvement of Senior Eni executives in a deal that has now lead to senior Nigerian officials being charged with criminal offences.”
This is a press release from the NGO Global Witness.