The transfer of over $800 million to accounts controlled by Dan Etete from a Nigerian government account was fraudulent and in contravention of Nigerian laws, the federal government told a UK High Court.
The money was part of the $1.1 billion paid by Shell and ENI for OPL 245, considered one of Nigeria’s richest oil blocks. Although the government sought to transfer the total sum to Mr. Etete’s accounts, suits filed by middlemen seeking payments for services allegedly rendered during negotiation meant the government could only transfer $801 million of the money.
About $110.5 million was transferred to a Swiss account after one of the middlemen, Emeka Obi, won his case against Malabu while $85 million remained stuck in the UK following a court ruling.
It was in a bid to retrieve the $85 million that the Nigerian government filed its suit at the High Court of Justice, Admiralty and Commercial Court in the UK in October 2016.
Nigeria’s former attorney general, Mohammed Adoke, who authorised the transfer in 2011 following a controversial agreement with Malabu and another with Shell and ENI, has repeatedly maintained that he acted in the best interest of the federal government on the matter.
However, in a notice filed at the British Court, the Nigerian government under President Muhammadu Buhari argued that the transfer of the funds was in contravention of Nigerian laws.
“Those funds should have been paid into the Consolidated Fund of the Government of Nigeria, following the grant of an oil exploration license to a foreign oil consortium,” the government argued according to court documents seen by PREMIUM TIMES.
The federal government argued that based on Section 80 (1), of the Nigerian constitution, all such monies should have been paid into the Consolidated Fund.
“All revenues or other moneys raised or received by the Federation (not being revenues or other moneys payable under this Constitution or any Act of the National Assembly into any other public fund of the Federation established for a specific purpose) shall be paid into and form one Consolidated Revenue Fund of the Federation,” the section states.
The government argued that it was therefore illegal for the Goodluck Jonathan administration to have opened a separate Escrow Account in JP Morgan bank in London into which the $1.1 billion was paid.
Even after receiving the money in the escrow account, the government argued, it should have been transferred directly into the Consolidate Fund.
ETETE’S ‘FRAUDULENT’ ROLE
Apart from the illegality of the account into which the money was paid, the Nigerian government also argued that Mr. Etete fraudulently secured the oil block for Malabu in 1998, at a time he served as petroleum minister under late dictator Sani Abacha.
PREMIUM TIMES had reported how Mr. Etete created a fictional character, Kwekwu Amafegha, who owned 30 per cent shares in Malabu at inception; thus meaning the minister awarded the block to a company he partly owned.
Restating this claim to the British court, the federal government said Mr. Etete’s action violated Section 98 of the Nigerian Criminal Code Act 1990 which makes it a criminal offence for any public official to corruptly obtain any property or benefit of any kind for himself or any other person in the discharge of his official duties.
The government also argued that Mr. Etete’s conduct in the use of Malabu as a front breached the code of conduct for public officials.
Section 5 of the Nigerian Code of Conduct Bureau and Tribunal Act 1991 provides that “a public officer shall not put himself in a position where his personal interest conflicts with his duties and responsibilities.”
Other sections of the Act like sections 10 and 23 were also violated by the then petroleum minister, the government said.
The government also argued that the failure of Malabu to pay any fee in 1998 when the block was awarded to it and also its failure to pay a $210 million signature bonus in 2016 was also illegal and further meant it had no right to the block.
“In summary, the 29th April Agreement was a corrupt agreement which deprived the claimant and the Nigerian people of the value to which it was entitled from the sale and exploitation of OPL 245 Block …” the government argued.
In its defence of the 2011 agreement and the transfer of the $801 million, Mr. Etete’s Malabu presented two letters written by Mr. Adoke. In the first letter dated July 25, 2011 and the second dated May 20, 2013, Mr. Adoke accepted responsibility for the 2011 agreement and transfers stating that it was in public interest and that he had the permission of the federal government to authorise the deal.
In its ruling on the matter, delivered on December 19, 2016, the British court agreed with the Nigerian government and ruled that the $85 million be handed over to the Nigerian government.
PREMIUM TIMES was unable to confirm if the Nigerian government had received the $85 million or what effort was being made to retrieve it as ordered by the court.
The spokespersons for the Central Bank of Nigeria and the Office of Attorney-General of the Federation could not be reached for comments throughout Monday. Their telephone lines were switched off.
A day after the court ruling, the Nigerian government commenced criminal proceedings against Messrs. Adoke and Etete, as well as others accused of involvement in the shady transactions that saw more than half of the $801 million Mr. Etete received go to companied owned by controversial businessman, Aliyu Abubakar.
Mr. Abubakar is believed to have been a front for officials of the Goodluck Jonathan administration. Shell and ENI are also being prosecuted for their roles in the scandal.
After years of denial, Shell recently admitted it knew the money paid would end in private pockets, including those linked to Mr. Etete who a few years earlier was convicted of money laundering in France.
Shell, ENI and their officials have also been indicted by an Italian prosecutor who wants them prosecuted for their roles in the scandal.
A BUSINESS SOLUTION
Despite the ongoing prosecutions, the Nigerian government has intensified moves in recent weeks to partner with Shell and ENI on the block and other business dealings.
The Minister of State for Petroleum, Ibe Kachikwu, told Acting President Yemi Osinbajo during a closed-door meeting on May 10 that the new deals being entered with Shell and Eni would be crucial to the country’s economic exploits.
“These are huge billions of dollars of investment in Nigeria, I am not going to shut that down,” the minister said, adding that “the issue of the criminality (on Malabu) is outside my realm.”
Industry insiders believe the renewed negotiations would be highlighted to shareholders at the Shell annual general meeting slated to kick off on Tuesday in the Netherlands in order to downplay the criminal prosecutions.
The oil giant would likely express optimism about the talks to convince shareholders that the Malabu probe would not damage its business interests in Nigeria and globally.