INVESTIGATION: Attorney-General, Adoke, in shady deal that may rob Nigeria of N549billion

Attorney General Bello Adoke

By Nicholas Ibekwe [PREMIUM TIMES] and Austyn Ogannah [THE WILL]

Nigeria will lose at least N549 billion ($2.8 billion) in oil royalty and petroleum tax if what appears a shady and absurd deal the Attorney General of the Federation and Minister of Justice, Mohammed Adoke, is negotiating with the Nigerian subsidiary of Chinese-owned Addax Petroleum, sails through, a joint investigation by PREMIUM TIMES and THE WILL has revealed.

This new shocking deal is reminiscent of the infamous Malabu Oil scandal in which the Attorney General was also named. It is not clear whether he is engaged in this new deal for pecuniary reasons.

We learnt that Mr. Adoke is working to reach an out-of-court settlement in a law suit over a 15-year alleged miscalculation of oil royalty obligations and taxes worth $1.7billion and at least $1 billion respectively between Addax (plaintiff) on one side and the Nigerian National Petroleum Corporation, NNPC, Ministry of Petroleum Resources (Department of Petroleum Resources, DPR), Federal Inland Revenue Service (FIRS) and the Attorney General of the Federation (defendants) on the other.

Addax had approached a Federal High Court in Abuja in 2014 to stop the payment of the disputed unpaid royalty stemming from its alleged miscalculation of oil royalty requested by the DPR.

The company is also challenging the NNPC for over-lifting crude from its Production Sharing Contract (PSC) of OMLs 123, 124, 126 and 137 to cover for the alleged miscalculation.

A source with extensive knowledge of the matter told our reporters that Mr. Adoke is putting pressure on lawyers and other officials working on the case to discontinue the law suit for a negotiated settlement that is unfavourable to the interest of the country and may cost the government an hefty N549billion.

According to our sources, lawyers working on the case, who are confident that the government has a good case and should follow through with the suit, are now distraught by the deliberate attempt by Mr. Adoke, who interestingly did not send any legal representation despite being named a defendant in the suit, to tank their hard work.

“Adoke did not make a representation, did not file his submission; did not show any interest in the case whatsoever,” one of our sources said. “The only time he showed interest was when the Federal Government asked for his opinion as the chief law officer of the government.”

There seems to be a rush to tidy this deal before the elections. Pressures are on the lawyers to seat on the table and knock out this deal with Addax,” another source added.

In fact, we learnt the NNPC has already directed its lawyers to discontinue further challenge of the suit and comply with “the dubious out of court settlement”.

The intrigue involved in the case is also deepened by the fact that Addax is represented by a former Minister of Labour, Adetokunbo Kayode, who briefly held the office of the AGF before the appointment of Mr. Adoke to the position.

“Adoke has a history of advising government in a way that make our country to lose money,” one of our sources said.

What our source was referring to was the role Mr Adoke played in authorising the transfer of $801 million to the account of Malabu Oil and Gas owned by convicted felon, Dan Etete, in the infamous Malabu scandal.

An extensive PREMIUM TIMES investigation had revealed that as at the time of ordering the transfer of the money to Malabu, which at the time was an illegal organisation as it was registered using a fictitious character and had submitted a fake address to the Corporate Affairs Commission (CAC).

If this new deal sails through, it would the second time in four years Mr. Adoke has presided over shady oil deals that have cost the Nigerian people several millions of dollars that would have come in handy in the face of tumbling oil prices that is the mainstay of the country’s economy.

Mr Adoke could not be reached for comments.

His mobile telephones were switched off when PREMIUM TIMES tried to reach him.

Questions were then sent to the spokesperson of the Ministry of Justice, Charles Nwodo, via email and text message. Mr Nwodo said our enquiry was passed to the appropriate quarters but no response came from the ministry for days.

The Side letter

The issue that culminated in the legal stand-off between Addax and the Nigerian authorities was triggered 14 years ago during the regime of the then President Olusegun Obasanjo.

In 2001, Mr Obasanjo, who was also his administration’s Minister of Petroleum, granted Addax a fiscal incentive of graduated rate of royalty based on the volume of crude oil produced from OMLs 123, 124, 126, 137, as opposed to the 20 per cent flat rate paid by the previous owners of the oil titles, Ashland Oil Company.

The details of the graduated payment is contained in a letter, referred to as a “side letter” dated December 20, 2011 and signed by Funso Kupolokun, Special Assistant on Petroleum to Mr. Obasanjo.

According to the letter, Addax was required to pay graduated percentage of royalty based on the amount of its daily production of oil from the oil titles.

Being the only company that enjoyed such a graduated rate, the DPR in 2003 decided to amend the Petroleum Regulations to provide a level-playing field to all exploration companies. However the royalty rate in the side letter and the amended Petroleum Regulation remained the same.

But instead of paying royalty based on its daily production as stipulated in the side letter and later in the amended Petroleum Regulation, Addax calculated its royalty obligations in tranches citing a heading in the side letter that reads: “Production in tranches as recommended by IC”.

By calculating its royalty obligations in tranches instead of using the daily production ration spelt out by the side letter and the Petroleum regulation, Addax drastically reduced the amount of royalty due to Federal Government.

Based on the alleged miscalculation, the NNPC computed the outstanding royalty payment and pretroleum tax due to government as $2.8 billion.

However, according to court documents seen by PREMIUM TIMES and THE WILL, Addax claimed that the NNPC has consistently violated the PSC. It argued that the NNPC engages in “arbitrary and unilateral” over lifting of crude to the tune of $390 million.

It also claimed that it has invested over $3 billion in the contract area, paid over $5 billion in taxes and has improved production from 10,000 barrels per day to 80,000 barrels per day. It said the overlifting of crude by the NNPC is injurious to its business and was creating liquidity challenges.

When contacted, Addax petroleum said it is unable to comment on the issue as it is a subject of litigation.

“Rest assured that Addax is a responsible corporate organization which upholds high ethical standards and carries out its business in line with the laws of its host countries,” said Dorothy Atake, a spokesperson for the company.

Ohi Alegbe, spokesperson for the NNPC, promised to crosscheck details of the case in question and get back to us. He is yet to revert to us as at the time of publishing this report.

Legal precedence

Meanwhile, lawyers representing the government said it was wrong and absurd for Mr. Adoke to be talking of a negotiated out-of-court settlement after all parties in the suit, except the AGF, have made their submissions, and just as the court was about to make pronouncement on the matter.

Feeling confidence that they have a good case even if the case goes all the way to the Supreme Court, the lawyers believe Mr. Adoke’s handling of the matter would create a precedence for similar disputes in future.

“In law they will tell you precedence matters. A deal like this would happen tomorrow and we would find ourselves in a scenario like this and someone would cite this case,” one of our sources said.


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  • blueeyedkitten

    when will this man stop destroying the reputations of the ebiras?

  • Omooba Adekunle Orafidiya

    Adoke is the most corrupt AGF Nigeria will ever have.

    • eddy

      Just like his oga!!!

    • Olu Ade

      Did somebody hacked Orafidiya’s account? Did he posted this will dreaming or sleeping?…Is this for real, I cant believe this is coming from a PDP dogmatic supporter; or are you just acting true to type of Goodbye Jonathan who will not take responsibility as the head of a rotten govt but will rather shift blame to subordinates.

      So, if Adoke is “the most corrupt AGF Nigeria will ever have,” what will you say about Goodbye Jonathan who has kept him on as AGF over these years. Can you say Jona, his boss is clean while the AGF is evil?

      So, if truly this is coming from Orafidiya, then you need to apologize for all your rants in support of Goodbye Jonathan over the years. END OF DISCUSSION.

      • Omooba Adekunle Orafidiya

        Senseless post.

      • Omooba Adekunle Orafidiya

        Your English is appalling! (“Did somebody hacked”, “did he posted”). No wonder you are a supporter of your fellow illiterate, Buhari.

        • Olu Ade

          Thank you, in my wild bewilderment that your brain calmed down for you to write and make sense for the 1st time, I got infested with Mama Piss and Jonathan’s type of English language.

          Anyway, don’t divert, address the issue today that you did not smoke your thing and your brain is clear as depicted in your original post.

    • Progress

      No ways! Chicken don dey grow teeth for Nigeria o. If this is true, GoodBYE Jonothin willnot even get to the 30% votes forecasted. Welcome on the #ChangeTrain if only for that single post.

    • SAM .A

      Are you dreaming, Or show your double personality.? First time you will be on the side of TRUTh

    • Denis_NG

      Where does Mike Aondoaaka rank?

      • Omooba Adekunle Orafidiya

        Aondoaka is a very distant 2nd.

  • staaaaaaaaaaa

    Patience Jonathan don talk am oooooooooo!!!!!!!! She doesnt want to serve her husband breakfast in the prison after being voted in 4 days time. Mr Adoke and the gang will definitely have many cases to answer as change come into Nigeria.

  • zacchaeus Akinleye

    The fruit of a poisonous is poison. Nigeria has been at the mercy of a disastrous PDP functionaries since 1999 and it is now time to say: “no mas”. On Saturday, March 28, 2015 let the PDP become HISTORY.

  • sol

    Following the footstep of his mentor gej

  • idris

    We need change in this country, GEJ is not acting in any case. Sai Buhari/Osibajo.

  • Halwa

    Over to you PDP e-rats. No comment yet?

  • rhad

    Corrupt jona, yam & goat ebele, e-pdpigs we need your responses but, we call always help you, it is APC propaganda abi? PDP- Corruption

  • Eze1

    Another yam is about to be consumed

    • Denis_NG

      …by another goat, ala GEJ

  • ConScience

    Where are the PDP fanatics that claim GEJ is the greatest President Ever. This wreaks of gross dereliction of duty. Someone may have received some kickback to look the other way and not see this through. Hence the decision to seek a hasty conclusion. May God help this country. Everything is for sale.

  • Strong System

    Just imagine how healthcare or agriculture would improve if such amount is deployed in such areas.
    Many public office holders ought to be shot not imprisoned.
    Said Buhari!!

  • Titi

    the only thing left for this govt is to shoot all of us and share what is left of our treasury

  • Bassey Esko

    Mmmmmm! In Brazil, in a very similar case where $20 Billion has been stolen from Petrobas, NNPC equivalent, the
    people are protesting and recently elected President Russuf is in “hot water” and could become a “lame duck” President
    even as she is in the early days of her Presidency because of the theft and corruption allegations. The peoples’ grouse
    is that after stealing public funds, the officials concerned now want to take more money from the people through belt
    tightening and austerity measures! What is the situation in Nigeria with respect to all the allegations of theft and
    corruption and now .. this, as we are just days to election of new Government?


    watin man go do wit over 5 billion naira.
    haba! kai!

  • Man_Enough

    this guy adoke has always been in the background gnawing away at the national treasury.

  • the truth

    This is an opinion of premium times and we should not rush to conclusions.Let’s wait until the facts come out

  • Thenjiwe Obong

    usually, I am not a supporter of the AGF, but it is within the prerogative of his office to settle a case if he so deems fit. also, in the interest of judicial economy, it is better to settle a case rather than drag the litigation over a prolong period only to arrive at the same result. premium times should look for something else to investigate and report. this is not it. money will be coming to the federal govt anyway, and sooner with an out of court settlement.

  • Rommel

    All cases of this nature should have been put off until elections are over,should Jonathan be going,it should be the incoming government that should have to take a second look at the deal and decide what is in the best interest of tha nation.

  • Oil Watch

    Obasanjo’s criminal corruption in Nigeria’s Oil sector

    General Obasanjo’s corruption of Nigeria’s oil sector is just being un-covered.
    The reason he appointed himself Minister for Petroleum Resources is clear.
    It was solely to make private profits by discretional award of oil blocs in Nigeria.
    Obasanjo’s corruption was deep and criminal and involved violation of law.
    Graduated percentage of royalty he gave Addax Ltd was unknown to law.
    It was out-and-out corruption which NNPC later enacted a regulation to cover up.
    That’s the proof of criminal illegality by Olusegun Obasanjo from 1999 until 2007.

    • FirecloudOFGOD

      He cannot flaunt that wealth today. He may be the first man to take his wealth to the hereafter! In that case, it may well have been well worth his effort.

    • Abasi Mbok

      … And they say, Sanusi and Soludo are liars! This report of Adoke’s second time manipulation to cheat our people and cause
      our country/Government to lose more money, added to ALL the earlier reports of theft, oil subsidy, pension scams
      crude oil theft and corruption at NNPC and other Government parastatals IS CONCLUSION THAT ENOUGH IS ENOUGH!
      Nigeria needs new leadership in Government at ALL levels.. period! 28 March and April 11 2015 provide us the opportunity
      and if Nigerians fail to act, then they must be prepared for another 4 years of excruciating pain, extreme economic and financial hardship!

  • musa aliyu

    Is this man not trying to play pranks should Buhari emerge president days to come? We’re watching. No amount of police can protect him should he dare play with our results.

  • Dr Pat Kolawole Awosan

    All members of People Democratic Party-PDP are involved in almost every shady deal of stealing,looting,scamming,embezzlement from the Nigerian public coffers right from the president to the councillors in the Local Government Councils.Under president Ebele Jonathan regime nothing works in all Nigeria vital public sectors except stealing,looting,embezzlement as the best PDP stands for is scamming,419 and stealing is not corruption.Nigerians must make clean break from PDP massive corruption om march 28,2015 in order to move Nigeria forward.Vote to elect APC-General Munahhadu Buhari as president of Nigeria in order to move Nigeria forward and change our future for the best.

    • burning spear

      Maybe u must have read the story upside down–It was your uncle Obj who first awarded the contract or the oil block to Addax–Sadly the owners of the oil wells in the creeks of the Niger Delta like Amaechi and Dickson are busy fooling themselves———-with members of the tripod—while those from the oil–less zones of the country smile their way to the banks.-The ongoing hatred against Jonathan is not because he has not out-performed——–all other presidents—it’s because of the oil-rich Niger Delta that he hails from period———This has been the case since oil was discovered in the creeks in 1957–work to demonize the people from that region–while they steal my oil blocks-So far its only etete–who was lucky to have been gifted with an oil block by abacha–even that is in dispute————-because of the zone he hails from in the south south–

  • Saydo Shan

    But what do U expect from the son of a Police Constable who was brought up with Egunje money?

  • burning spear

    Obj operated the oil industry as if it was his personal property–if an Ijaw had controlled the the Ministry of petroleum resources for 6 years–as did Obj—the likes of Falana-Soyinka and Sagay-would have been allo ver the place to ask for his head————Obj and atiku controlled the PTF as if the oil wells were located–in their homes-At the end of their tenure–Atiku built a University for himself and his Family——Obj did same–erected a University with the money he stole from the oil sector for his family————–But When it got to the turn of Ijaw man Jonathan he built 12 Universities- for the nation state of Nigeria—————————–yet he is being vilified by the rats and lizards in APC

    • Red Lion

      Dezine is ijaw. Say another lie.

    • Wale Reze

      Can you please post pictures with names and locations of the so called 12 Universities Jo-Lantern built for Nigeria??
      Sometimes I feel pity for you people with the absurdities you post on here…. Lol!!

  • halima

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    • FirecloudOFGOD


  • Guguru

    Nigeria is an extraordinary crime scene. The elite are trying to rob Nigeria into ultimate penury.

  • richkid

    Some people fabricate false news to see if they can eat where they didn’t sow and probably to draw support from one party to another. GEJ has won

    • Guguru

      The economy is collapsing and yet GEJ has won. LOL.

      • Wale Reze

        Speaks volume of his reasoning power I guess….. Wonder what happens to these sub-humans when GMB is voted in. *Smh*

        • Guguru


          LOL. I try not to think about such an issue because I know that some people will flee Nigeria if GMB wins. Some have already bought their tickets and obtained their visas to run from Nigeria should GMB win.

  • Most Honestly Amadioha

    We will change the game soonest

    • Denis_NG

      I really like this map! However, would give Enugu, Taraba, FCT and Benue to PDP. Ekiti, Edo and Kogi to APC. The rest can be considered a battle ground between the 2 parties. At the end of the day, things are not looking very good for PDP.

  • David Adeniran

    The corruption in Nigeria is no respecter of ethnicity nor religion nor personality. You find virtually most of the people from across all the ethnic groups and major religions involved in this ungodliness. Therefore redeeming Nigeria from corruption should not be a RELIGIOUS FACTOR NOR AN ETHNIC CONSIDERATION. Among those that have presented themselves for political service today and among the present generation of Nigerian Politicians, Buhari stands out far above all. I am a Christian and a Southerner, I am not ashamed to canvass for this man. Indeed and in truth he is the Cornelius of our generation. Therefore give him a CHANCE. The corrupt hates him and maligns him but the righteous and Godly loves him and respects him. VOTE BUHARI/OSHIBAJO 2015!!!

    • Burbank

      david adeniran
      Buhari is the best man to lead Nigeria.

  • John Wick

    Nigeria will never get better If we don’t start killing these criminals that never get arrested and jailed. Eliminating them one after the other will solve this country’s problems. Period!

  • Barrister Awo

    Editor Premium Times:

    Law profession collapsed in Nigeria as morally dissolute persons are pitchforked as the S.A.N
    and given a virtual license to steal, to forge, to dissemble and lie, to fabricate and forge anything.
    Here then is the body of a once good profession lying-in-state without tearful mourners for burial.

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