The Malabu Oil saga started two decades ago, with many Nigerians still in the dark on its genesis and how it had shaped Nigerian economy and Government today.
The controversy began in 1998 under the military regime of the late General Sani Abacha.
The Government of Gen Abacha awarded an Oil Prospecting Licence (OPL) to Malabu Oil & Gas Ltd for Bloc 245, reportedly owned by Kweku Amafagha, Mohammed Sani, and Hassan Hindu.
It was later discovered that former Minister of Petroleum under Abacha’s Government, Dan Etete was the actual owner of the Company through which the Oil Bloc was purchased.
The deal was struck only five days after the company was incorporated and the stakeholders were imaginary persons as; Mohammed Sani was the son of Abacha, Amafagha was a fake name used by Etete himself and Hindu was the wife of Alhaji Hassan Adamu, the then Nigeria’s Ambassador to the US.
Malabu acquired the Bloc and paid $2 million out of the $20 million signature bonus legally required for the purchase.
Troubles
After purchasing the Bloc, it brought Shell as technical partners with an agreement of 40% interest to Shell Nigeria Ultra Deep Limited (SNUD).
In 2001, former President Olusegun Obasanjo revoked Malubu’s licence and then invited some International Oil Companies (IOCs) to bid for the Bloc.
Shell participated and won the bid and was awarded the Bloc with an agreement to pay $210 million signature bonus, which left Etete betrayed.
He petitioned the House of Representatives which conducted a public hearing and concluded that the revocation of the transaction and sale to Shell were in bad faith.
The House then ordered the Federal Government to return the licence to Malabu, but it refused compelling Malabu to seek legal battle by heading to Court and series of litigation ensued until 2006 when both parties sought out-of-court settlement.
Shell also instituted litigation, but later decided to negotiate directly with Etete after former President Goodluck Jonathan assumed office in 2010.
New turn
In 2011, Malabu decided to sell the Oil Bloc, but was not ready to negotiate with Shell after its perceived betrayal.
Eni of Italy came forward and after series of negotiation, a price of $1.1billion was agreed and the deal was conducted.
Eni had partnered with Shell to negotiate the deal with Malabu in which a total of $1.3billion was paid; $1.1billion for the Bloc and the $210million was for signature bonus paid to the Federal Government.
Where it went wrong
Rather than the money being paid directly to Malabu, Eni/Shell decided to pay the money to the Federal Government, who then transferred part payment to Malabu.
It was reported that $520billion was converted to cash and gifted to some Nigerian officials to ensure the deal succeeded.
Eni and Shell reportedly paid the money to Federal Government to block any traces of bribery back to them but investigations revealed they were negotiating directly with Etete.
They did not want to deal directly with Etete, who had been convicted in France for his part in a separate money laundering scandal, so they sent the money to an account belonging to the Federal Government of Nigeria in JP Morgan bank, London.
The Attorney General of the Federation, Mohammed Adoke, and Minister of State for Finance, Yerima Ngama, authorized the transfers.
Global Witness and Finance Uncovered, anticorruption organisations based in the UK, would later reveal that leaked emails from the Executives of Shell and Eni suggested they knew that bribes were going to be paid from the deal.
Nigerian officials who were alleged to have received bribes from the bid include former Attorney General of the Federation, Mohammed Bello Adoke, former President Goodluck Jonathan, former Minister of Petroleum, Diezani Allison-Madueke among others.
President Jonathan was reported to have received $200 million from the deal to which he denied.
Both Shell and Eni, as of September 2014, are under investigation for corruption by the UK and Italy authorities for the incidence.
The Economic and Financial Crime Commission (EFCC), had then filed a nine-count criminal charge against Adoke, and eight others over the Oil Bloc deal. But curiously left out Jonathan.
Adoke was accused of misleading the Government, authorising the diversions of the funds and collecting a bribe of $2.2million, which he vehemently denied.
Charges and Prosecutions
Key figures in Italian Oil multinational, Eni, are now under formal investigation by magistrates in Milan for alleged corruption relating to the OPL 245 deal.
The Corporation’s new CEO, Claudio Descalzi; his predecessor Paolo Scaroni; and its Chief Development, Operations, and Technology Officer, Roberto Casula, have all been named as suspects in the bribery investigation.
In 2014, Italian prosecutors wrote to UK’s Crown Prosecution Service (CPS) to freeze the assets of those involved.
British prosecutors acting on the request have already frozen two accounts with combined sum of N29.5 billion ($190 million) belonging to the chief intermediary, Emeka Obi.
The President Muhammadu Buhari-led administration had also vowed to ensure the perpetrators are brought to book.
But in a letter, leaked in February, from the Minister of Justice and Attorney General of the Federation (AGF), Abubakar Malami, to Buhari dating from September, he was reported to have asked the President to interrupt the EFCC investigation.
But in the letter, Malami expressed concern that the case did not contain enough evidence to bring the main defendants to justice and that a trial would be an embarrassment for the Country and could put off potential investors.
While fielding questions from journalists, the Minister said he had not asked the EFCC to stop the trial of the suspects but to carry out further investigations, describing the report that he advised that the President should order a stop of the trial as mischievous.
According to him, “It was never about not prosecuting but enhancing investigation.”
He said his letter to the EFCC was a directive to the acting Chairman of the commission, Mr. Ibrahim Magu, requesting that further investigations be conducted into the scam and ensuring that legal action was instituted in the UK to freeze the $1.1bn proceeds of the scandal.
Mr. Abubakar also announced that the United Kingdom has paid Nigeria the sum of $70m recovered from the controversial deal, leaving an outstanding of $15m of the $85m which the AGF announced in October last year as the amount being expected to be recovered from the UK in respect of the deal.
In April, the Government of Switzerland also reported that it had blocked several bank accounts in the Country linked to the planned bribery trial of Eni and Shell executives in Milan, Italy, as it relates to the infamous Malabu oil scam.
Global Witness called for justice, saying that “$1.1 billion can help a lot of people in a country like Nigeria” where “80 percent of citizens live on less than two dollars a day”.
