Malabu OPL245 Fraud: Dan Etete wants Nigeria’s N17 billion

Former Minister Dan Etete, the man behind Malabu
Former Minister Dan Etete, the man behind Malabu

British court will on Tuesday, December 15, decide whether  $85 million (N17 billion) frozen by UK authorities should be released to a fraudulent company, Malabu Oil and Gas, controlled by ex-convict, Dan Etete.

The money, frozen at the request of Italian authorities, is part of the $1.092 billion paid by oil giants, Shell and ENI, to Malabu through the Nigerian government.

PREMIUM TIMES had reported on the deal, enmeshed in various layers of corruption, and currently under investigation by authorities in four countries from three continents.

The $1.092 billion was meant as payment for an oil bloc, OPL 245, the juiciest oil bloc in Africa and estimated to contain about 9.23 billion barrels of crude oil.

Mr. Etete awarded the oil bloc to Malabu in 1998 while he was Nigeria’s petroleum minister against Nigerian laws as he failed to declare his interest in the company and actually falsified a fictional character, Kweku Amafegha, through which he owned shares in the company.

Both the givers, Shell and ENI, and the Nigerian government have given contradictory reasons on the 2011 agreement which led to Mr. Etete being paid money which should have gone to improving the lives of Nigerians.

While Shell and ENI have, contrary to all evidence, claimed that they paid the money to the Nigerian government not knowing who the final beneficiary would be, the Nigerian government through the former attorney general, Mohammed Adoke, claimed it only acted as a  “facilitator” between two willing parties.

However, while about two thirds of the money (over $800 million) has been shared and largely spent by Mr. Etete and his cohorts, about $195 million dollars remain frozen in two separate countries- England and Switzerland.

Summary of Malabu's history

Summary of Malabu’s history. Source: Global Witness

Freezing $110 million

The first of the frozen sum, $110.5 million (N22.1 billion) is held by Swiss authorities on the request of Italian prosecutors who are investigating ENI’s role in the fraud.

The money was transferred to Switzerland from London after a shadowy businessman, Emeka Obi, through his company, Energy Venture Partners (EVP), won a suit against Malabu. Mr. Obi sued Malabu in London claiming he was entitled to a share of the largesse as he had helped facilitate the deal between the oil majors and Malabu. In July 2013, the High Court of Justice, Queen’s Bench Division presided by Lady Justice Gloster ruled in favour of Mr. Obi that he was entitled to “a fee of 8.5% of the total disposal consideration of $1.3 billion.”

Following the court’s ruling, the money was transferred to EVP’s Swiss accounts. However, Italian authorities who had by then started investigating the fraudulent deal asked Swiss authorities to freeze the money where it has since remained.

The London $85 million

Like it did in Switzerland, the Italian prosecutors also called for a freeze of $85 million in the London account. The money was the last part of the OPL 245 largesse not yet distributed.

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However, sensing that the Muhammadu Buhari administration was yet to find its feet on international legal matters, Mr. Etete approached the British court and asked that the money be returned to him.

At a two-day hearing that started on November 23, Mr. Etete’s lawyers argued that there was no fraud in the deal and asked that the money be released to him.

While Mr. Etete argued that the money be released to him, the Italian prosecutor argued that “their investigation could lead to a potential forfeiture of the money down the road,” a source who has followed the case and was present at the proceedings told PREMIUM TIMES.

Malabu’s lawyers told the court that freezing the money was an assault on Nigeria and questioned how the court could imagine that Nigeria’s former Attorney general, Mr. Adoke, and Minister of State for Finance, Yerima Ngama, who both authorised the deal could be a party to corruption.

PREMIUM TIMES had reported how both Messrs. Adoke and Ngama hurriedly approved the transfer of the $1.092 billion of the total sum from Nigeria’s London account into Malabu’s accounts a day before former World Bank Managing Director, Ngozi Okonjo-Iweala, was to assume office as Nigeria’s Finance Minister and Coordinating Minister of the Economy.

Mrs. Okonjo-Iweala later washed her hands off the deal and referred all enquiries to Mr. Adoke, who as reported by PREMIUM TIMES lied to Nigerians and the House of Representatives about the deal.

At the British Court on November 23 and 24, Malabu’s lawyers did not disclose to the judge that Mr. Etete was recently questioned by the anti-graft agency, EFCC, which is investigating the case and stated in an interim report that the deal was fraught with corruption.

At the court, the Crown Prosecutor argued that the money should remain frozen and described the 2011 agreement as a “smashing grab of the Nigerian government then in the hands of Goodluck Jonathan.”

It involved “high watering amount of money” and was centred on a “corrupt arrangement,” he told the court.

The prosecutor described Mr. Etete as a “bagman” who has distributed the funds to “prominent Nigerian figures.”

The prosecutor listed the $10 million paid to Bayo Ojo, Nigeria’s former Attorney General, and over $500 million paid to Abubakar Aliyu, a man described as “Mr. Corruption” by EFCC officials and a close ally of ex-President Jonathan and other PDP leaders, as evidence of the distributions.

The prosecutor said Malabu has not been able to justify the money given to these individuals and that there was “a strong inference of corruption,” in the deal.

He described the deal as a textbook example of grand corruption and the involvement of the Nigerian government as a necessary part of it being grand.

Nigeria absent

Although the Malabu deal is being investigated by the anti-graft agency, EFCC, which recently invited Mr. Aliyu for questioning, and the presidential committee on corruption, Nigeria was not represented during the London hearing.

PREMIUM TIMES had reported how the EFCC investigation was stalled during the Jonathan administration with investigators lamenting they were discouraged from proceeding with their work although an interim EFCC investigation report stated that the deal and transfers of the money showed a “cloudy scene associated with fraudulent dealings.”

Barnaby Pace, an oil transparency campaigner with Global Witness, expressed surprise at Nigeria’s absence at the London court giving the opportunity the country has not only to retrieve the money but also to set a major example of President Buhari’s repeatedly stated stance of firm opposition to corruption.

“The Nigerian government coming out to say this a corrupt deal is a massive game changer,” he said. “It’s a fairly obvious test case for the Nigerian government.”

However sources at both the EFCC and the Nigerian Vice President’s office confirmed to PREMIUM TIMES that the government was now aware of the case and would cooperate with both the Italian and British authorities to ensure all the fraudulent sums are returned to Nigeria.

Irrespective of how Nigeria acts, the decision whether or not to release the $85 million to Mr. Etete will be made by the British judgeon Tuesday.

UPDATE: Information just reaching PREMIUM TIMES indicate that Justice Edis of the SouthWark Crown Court has postponed ruling on the $85 million. The judgement will now be given on Tuesday, December 15.

This story has been edited to reflect the new information.



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