How drowning Chinese-owned oil firm paid millions of dollars as bribe to Nigerian officials

Refinery  used to illustrate the story.
Refinery used to illustrate the story.

As the Chinese-owned Addax Petroleum winds up its operations on December 10, a confidential document has emerged showing how the company paid millions of dollars in bribes to Nigerian officials to secure juicy contracts in the oil industry, PREMIUM TIMES can report.

According to the report, there were payments for “questionable transactions” to Nigerian lawyers and a company owned by politician Emeka Offor, with a huge chunk of the money believed to be used to bribe government officials, PREMIUM TIMES can report.

The document, a report by leading audit firm Deloitte obtained this week by Swiss newspaper, Le Temps, said payments in excess of $20 million were made to four Nigerian “legal advisors” (one of them based in the U.S.), while more than $80 million was paid to Mr. Offor’s Kaztec Engineering Limited for questionable projects.

“We have concerns over payments in excess of $80 million, which were made by Addax to Kaztec regarding construction projects for the Antan and Udele/Ofrima developments,” the audit firm stated in the document dated November 18, 2016.

“$70.8m was paid in 2015, including $48.7m for the Antan development, which was suspended in early 2015, and $15.8m for value engineering work on the Udele Ofrima development. This value engineering work has not taken place.”

The audit revelations on the misuse of Addax corporate funds came amidst moves by the company, a subsidiary of Sinopec International Petroleum Exploration and Petroleum Corporation, to wind up some of its operations across the world.

Last August, it announced a proposed closure of its corporate offices in Geneva, Aberdeen, and Houston as oil prices continued to shrink.

In 2001, the Olusegun Obasanjo government granted a fiscal incentive of graduated rate of royalty based on the volume of crude oil produced from OPL 98/118, now OML 123, 124, 136, and 137, as against the flat rate of 20 per cent obtainable in the industry. The fiscal regime was deemed to become effective on January 1, 2000.

Addax claimed it committed a “significant investment” in excess of $3 billion in the development of the contract areas.

However, in July 2011, the Federal Inland Revenue Service and the Department of Petroleum Resources raised an objection to the fiscal regime.

In 2014, Addax Petroleum dragged the Nigerian National Petroleum Corporation before a federal court in Abuja over allegations of miscalculation of oil royalties and taxes and a breach of their 1998 Production Sharing Contract regarding the OMLs.

Joined as respondents in the suit FHC/ABJ/CS/1099/2014 were the Ministry of Petroleum Resources/Department of Petroleum Resources and the Federal Inland Revenue Service.

But just four days before leaving office, the administration of former President Goodluck Jonathan negotiated a controversial out of court settlement with Addax Petroleum, agreeing to pay the company $3.4 billion (about N1 trillion).

‘Questionable legal fees’

In 2015, PREMIUM TIMES reported how then Attorney General of the Federation, Mohammed Adoke, negotiated the shocking deal in what industry experts said was reminiscent of the infamous Malabu Oil deal in which the same Mr. Adoke was involved in.

“The parties expressly acknowledge and agree that this Agreement is being executed and delivered as part of a legally binding commercial transaction in full and final settlement of all disputes concerning or related to the applicable fiscal regime in respect of OML 123, 124, 136 & 137,” the agreement stated.

“The parties agree and acknowledge that time is of the essence with regard to the Settlement Agreement.”

The audit report stated that high-level bribing of Nigerian government officials was instrumental in clinching the settlement.

However, in a letter to Addax dated September 7, 2015, the NNPC reversed that agreement in a decision endorsed by then newly elected President Muhammadu Buhari, in one of his first moves to clean Nigeria’s monumentally corrupt oil industry.

The Deloitte report alleged that a significant proportion of Nigerian contracts involved bribing of government and other related officials and kickbacks by Addax management.

The allegations included the use of company funds to buy a 75,000 Swiss Francs (about N30 million) Chopard watch intended as a “gift” for the then Nigerian Minister of Petroleum, Diezani Alison-Madueke.

The watch never reached Mrs. Alison-Madueke.

Another allegation was the use of a Bermuda based company called ‘Winfield’ to purchase about $150,000 worth of gifts to an unnamed Nigerian official.

“The Nigerian official is alleged to have chosen the goods whilst in China and Addax paid for the goods through Winfield,” the audit report stated.

There were also allegations that the Addax Chief Executive Officer acknowledged that the Nigerian legal payments were used for purposes other than legal work, with him quoted as saying “what the lawyers do with the money after we pay it is none of our business, it’s only the result which counts.”

In March this year, Zhang Yi, Addax’s CEO in its Geneva Office, and the Legal Director were arrested and charged with the payment of millions of dollars to some lawyers and an unnamed company in Nigeria.

In June, Addax Petroleum reached an agreement to pay 31 Swiss Francs (about N12 billion) fine in Geneva to settle the bribery allegations.

In the new document seen by PREMIUM TIMES, the law firms who received the over $20 million controversial payments from the company “in relation to side letter negotiation in 2015” included Ahmed Raji and Co, Pollie Okoronkwo Immigration Attorneys, Solola & Akpana Chambers, and Consolex Legal Practitioners. PREMIUM TIMES contacted the named law firms.

Some of the concerns raised by the audit in the legal payments were unprofessional conduct, low standard documentation not of the standard of reputable law firms; unverifiable information (addresses for example), provided on invoices; “extremely vague”scope of work which, in some circumstances, it was virtually impossible to determine what the law firms did; and inconsistent and contradictory explanations for the payments by management.

“We have not received sufficient audit evidence that their payments were legitimate business expenses compliant with all relevant laws and regulations,” the audit firm continued.

“We suspect that some of these funds may have ultimately been utilised to bribe government officials to receive a favourable settlement in relation to the side letter as has been detailed in the whistleblowing allegations in this letter.”

On the payments made to Kaztec Engineering Limited, the audit stated there was lack of adequate supporting documentation for the payments made in 2015 and, also, a lack of evident commercial rationale for a significant portion of the payments.

It noted that number of internal reports that were suppressed by management had expressed concerns about significant overpayments to the company.

“We have not received sufficient audit evidence that these payments were legitimate business expenses compliant with all relevant laws and regulations,” the report stated.

“We suspect that some of these funds may have ultimately been utilised to bribe government officials to receive a favourable settlement in relation to the side letter as has been detailed in the whistleblowing allegations.”

Audit report ‘a joke’

Deloitte said rather than Addax Petroleum management acting upon its audit recommendations, it chose to terminate its appointments with the firm in Nigeria, the Isle of Man, and the UK.

Mr. Offor is a controversial Nigerian politician who became broke in 2017, barely two years after donating $10 million to the Carter Centre to fight river blindness.

He did not immediately respond to requests for comments.

Pollie Okoronkwo, a U.S.-based immigration attorney, did not also respond to e-mail requests for comments.

The Nigerian law firms, however, pushed back vehemently on Deloitte’s claims of questionable payments made to them and the likelihood that it was used for bribing officials.

“If they said they didn’t know what the payment (to us) was for, then it’s a joke,” Okey Egbuchu, a partner at Consolex Legal Practitioners said when contacted by PREMIUM TIMES.

“It was a court case, so it’s a matter of records that we had representation so it’s not an issue at all. We represented (the company) in the matter, it’s a public record that you can look at, it’s at the federal high court in Abuja.

“They paid for our services, it’s been a while now so I don’t have it (the case) offhand but it involved plenty of money, hundreds of millions of dollars.”

Henry Chibor, a partner at Solola & Akpana Chambers, said his firm never worked for Addax, adding that he was not aware of any audit report.

“We didn’t do matters for Addax, I don’t know what you are talking about, any person can go and write whatever he likes,” Mr. Chibor told PREMIUM TIMES.

“If you have such document, I think that the only way forward is for us to see it then we will be able to answer anything. I can’t sit here and begin to talk about a company that has no legal relationship with us, we didn’t work for.

“Because any person can write anything he likes, until we see it then we’d know what the person is talking about. Addax that has gone down a long time ago, what did Addax do with Solola & Akpana?”

Ahmed Raji of Ahmed Raji and Co said his firm was approached by Addax in 2014 and they started work for them in early 2015.

“We did work for Addax, we were given letter of instruction and we did our job and then we agreed on fees,” said Mr. Raji, a Senior Advocate of Nigeria.

“Addax is worth about $4 billion, they had an issue that was threatening the entire state and then they contacted us as lawyers, we have letters of appointment and we did our work and we were paid our fees, I don’t know where they got that one from,” the lawyer said about allegations that part of the legal fees was used in bribing Nigerian officials.

“If they know any public officer that we bribed, let them name him.

“If a lawyer opens an office and people walk in and they say ‘look, this is our problem.’ You look at the magnitude of the problem and you say this is my bill. And you do your best. If they now want to be basking in the euphoria of speculation, they can go ahead and try it and then we’ll meet up.

“And if you are speculating that somebody had tried to bribe a public officer, as good auditors won’t you go and ask them? Won’t you know an audit trail and look at inflows and outflows from the account?”

“Because it’s very sickening, you are talking of bribing public officers, who are the public officers? Name them. Our accounts are there, they didn’t say we were paid in cash, where is the outflow to any public officer if they are not a useless and irresponsible set of auditors? This is our story, this is my argument and there is nothing like that.”


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  • bola

    This is a kind of whistle blowing which must be investigated. We can now imagine how the country (Nigeria) would have been now if the administration led by GEJ is still in power

    • Shift Luther

      Allegations and what was rate of FDI under gej

    • dan

      Deals are still going on now my bro only that you may not hear about it now.

      • FineBoy

        When we expose yesterday today, tomorrow we expose today.

        In that we, the fear of tomorrow will bring caution.

        Until Jesus comes crime won’t be eliminated in the World

      • Pluti

        Yes it sure goes on cos criminals never stop their job but truly tomorrow we will expose today and yesterday so long the judges and the journalist take their jobs seriously more than the thieves

  • Dr Pat Mumuwole Awosan

    This is mere propaganda to rubbish PDP as presidential elections draws closer. Bribes were paid and so what? Every country pays bribes to secure deals. America paid bribes to Nigeria during Obasanjo’s evil rule to secure oil deals for Haliburton…and when Jonathan burst the bubble and was going to seek extradition of that useless American Vice President (Dick Chiney), that miserable crooked Hilary paid further bribes to Nigeria in form of compensation in lieu of extradition. So bribes are the norm even if the nomenclature differs. PT can be more responsible in its reporting rather than be a tool for political attacks. It should investigate and tell us the names of the suicide bombers who attacked a Mosque in Northern Nigeria killing over 50 people. Investigate and give us the name of at least on Fulani herdsman who has been arrested and is in jail for any killings, arson, rape and beheadings and other crimes committed. Tell us about oil spills in the Niger Delta that is ravaging the environment. Useless journalists. Sick minds. Every story is about MONEY, MONEY, MONEY and MONEY and you never talk about cleaning up and restoring the environment that this oil money destroys and renders inhabitable.

    • FineBoy

      Supporter of evil.

      Because A did so B must do it?


    • bola

      Sir, you called PT sick minded journalists because they exposed bribery activities but when PT made a publication on the issuance of Nigerian Passport by the NIS they were not sick minded. Am sorry for Nigeria

    • Pawa2

      Mumuwole fits you as a name. It is on record that while USA was prosecuting and fining companies and individuals involved in the Halliburton case, Nigeria did not even act on it. The claim that Jonathan sought the extradition of anyone from the US must have come from the dark recess of your warped mind, as did most of the claims you made in your highly unintelligent and ridiculous post.

      • kinsly

        Comments from a Retard.

  • Oil SPILLS in the Niger DELTA

    THE people of Uwheru community in Ughelli North Local Government area of Delta State have appealed to Delta State and Federal Governments to come to their aid over an oil spill that is currently ravaging their community. The spill which occurred on a pipeline linking the Evwerni Well 8 & 9, was reportedly noticed by residents of Egbo quarters of the community on October 29. Umukoro (A representative of the community) explained; “Suspecting equipment failure, we contacted the company and they promised to do the needful but till date they are yet to and the spill is doing more damage to other adjourning farmlands in the area.”

    On the extent of damage by the spill, another community leader, Boggie Ogbe said: “At the moment, the livelihood of the community which is fishing and farming is in jeopardy because the spill which is on the stream in the community, has damaged aquatic life and is fast spreading to other areas.”

    All Brigadier Buhari cares about is the money from the Niger Delta and giving orders to Army to harass, rape, kill and molest civilians and protect the foreign oil company staff and not about the people who own the oil wealth. When there was oil spill at the Gulf of Mexico in US, President Obama personally visited and engaged Shell BP and the company had no choice but to clean up 100% and pay compensation. But in Nigeria Imam OLODO aka brainless and certificate forger does nothing. Niger Delta AVENGERS please and please come to our aid. We beg of you

  • Rx

    “In 2001, the Olusegun Obasanjo government granted a fiscal incentive of graduated rate of royalty based on the volume of crude oil produced from OPL 98/118, now OML 123, 124, 136, and 137, as against the flat rate of 20 per cent obtainable in the industry. The fiscal regime was deemed to become effective on January 1, 2000…”

    Why did you not tell us about the bribes Addax paid to Obasanjo’s govt and the officials to secure the fiscal incentive against a flat rate of 20% at the time? Is this why you did not feel comfortable including Jonathan’s name in the title of the report as you always do? Rubbish!

    • Pawa2

      The fiscal incentive was right for the time and it was not only Addax that profited. Use your head.

  • Pawa2

    “But just four days before leaving office, the administration of former President Goodluck Jonathan negotiated a controversial out of court settlement with Addax Petroleum, agreeing to pay the company $3.4 billion (about N1 trillion).”

    Says it all. Clueless thief. He was even clueless as a thief; the people around him stole more than he did and he just sat down there drinking. He was satisfied as long as money being paid into his accounts (and his wife’s) were more than he thought he could have had beyond his wildest dreams.

  • Pawa2

    Great journalism from Premium Times. By far the best newspaper/outlet in Nigeria. Well done.

  • Dr Bunmi Binitie

    Did people actually ever used to do things right? And how much of this is still going on underground? This is disheartning!

    • O.O. Williams


      President Muhamadu the worst

      Buhari is the worst president Nigeria has ever had; the least educated, the
      most dishonest, the most crooked, the worst mentally lazy, the most bereft, the
      most denuded of thought-process, and, the most inarticulate, stammering
      Islamist bigot ever to enter the presidential villa, flying Fulani tribe flag.

      • Dr Bunmi Binitie

        Did you read the article at all? It has nothing to do with PMB givernment as it all happened long before he came.

        Your opinion is your personal one. I totally disagree with you!

      • curseless

        My dear Dr Binitie, facts are stubborn things and whatever are your wishes , or the dictates of your passion they can not alter the state of facts and evidence. The comments you made here are totally out of order and presumptions . The article speaks for itself

        • Dr Bunmi Binitie

          My dear Curseless, you should know me by now. I am a die-hard PMB supporter!

      • Dr Bunmi Binitie

        O O Williams!!! You crook!! I never wrote what you posted! Ika! The Lord rebuke you!!!

  • curseless

    I read somewhere that Mr Offor is now broke but I don’t know if this is true or not, but one thing that true is that the wealth of the wicked is laid up for the righteous to inherit.

  • Jach J. King

    Nigerian Lawyers are more dangerous than deadly condemned armed robbers at Kirikiri Maximum Prison.

  • Dr Pat Kolawole Awosan

    The only remedy to the endemic corruption practices which pervade Nigeria-public offices and private sector, is the introduction of death penalty as ultimate punishment for any act of looting,stealing and embezzlement, from the Federal institutions and private sector in Nigeria, like China.The total population of Chinese people is about 1.4 billion citizenry and the communist-China, authorities take anything corruption-crimes seriously any anyone caught automatically faces death-penalty or long term in the prison with leniency.Most Nigerian civil servants and politicians, love indirect demand for bribe before performing their official duties that Federal and state governments are paying them for as civil servants.The supreme court justices and our senior lawyers who are senior advocates of Nigeria,SAN. are worst.

    • Adele Uhuru

      No death penalty wont stop these crooks in public office, they will find a way around it anyway and it won’t be legally supported globally and locally……..The best approach will be a complete re-education and an implementation of a claw-back agreement with any budget controlling office in the public sector- emphasizing that the person in charge of the budget will be paid quite well but will also be responsible for any misappropriation without due diligence and accountability of the funds disbursed, in cases of proven misappropriation these individual will be held accountable and being that they have already signed a binding agreement they will have no legal recourse but pay the price for the lost funds meaning they can loose everything they’ve owned. This means this office will now keep a meticulous receipt of all expenses, because they know that the will be the biggest loser. When you know you are being paid well and you are held personally responsible for your misadventures you will think twice before you willfully misappropriate or support any misappropriation of the funds you are directly responsible for.

  • Sanssouci

    Sentiments overtake things in Naija, and people draw their own conclusions even with an inconclusive story like this one and with zero evidence, it is unfortunate. I agree 100% with the position of Ahmed Raji SAN. how can you accuse someone of giving bribes without an audit of their statement of accounts or naming the bribe recipients? Or blanket statements like “scope ow work was vague”? can we read the said scope of works to judge for ourselves? they are indeed useless auditors. This story is nothing more than a smear campaign if the so-called auditors cannot publish the lawyers’s terms of engagements, scope of works, name the bribe recipients and provide the certified bank statements of both givers and recipients of bribes, then there was no point publishing the story at all.

    • Rommel

      Didn’t you read the part about the people that paid bribes having been arrested in Swiss and they naming the recipients, must everything be explained to you before you can put two and two together, everything to you looks like fake news, nothing is real again as long as it has something to do with looting of public funds.

      • Sanssouci

        Not a fair assessment of what i wrote

      • Special Clearance

        What if those arrested (Scrupulous Chinese) by the Swiss pocketed these huge sums of money but decide to connect the Nigeria bribery angle into it knowing fully well that the Nigerian bribery angle will be swallowed hook, line and sinker by all. The right and professional thing to do when you lay such weighty allegations is to provide concrete evidence such as naming the bribe recipients particularly and perhaps provide the paper/ bank account trails of both givers and recipients of these bribes, anything other than that gives room for a lot doubts.

        • Adele Uhuru

          Do you know I have seen couple of business partner that are advocating to move a portion of their business entity into Nigeria or any west African country only to create or stage a construction that allows them steal these monies imported into Nigeria under the auspices that thees monies was stolen or used to bribe Government authorities only to keep these funds and export it back to an off shore account for their personal use while Nigeria is blamed for their mishap and in some cases they pay a minimal fine and walk away wealthy. But the Nigerian factor plays well for these foreign crooks to cover their thieving tracks………………………..

      • Adele Uhuru

        nonsensical rubbish from a maligned mind

  • Rommel

    I sincerely think that president Jonathan should be given a psychiatric evaluation, it appears that all his decisions were tainted with deals that never benefitted Nigeria, how come he never implemented things like BVN,TSA and others that he arranged, policies that wold have benefitted the country but everything that would bleed the country got approved, shame to the man.

    • Adele Uhuru

      Buhari implemented Jonathan’s policies such as the aforementioned BVN, TSA but still we have 25.6 Billion USD NNPC illegal contract awarded by his proxy with PMB as the Minister of Petroleum, His right hand man swindled millions with his MTN settlement agreement on MTN’s multiple violations and infractions of rules meant to protect against illegal use of the communication apparatus by terrorist killing Nigerians, then You have the low ball Grass cutter thievery an impunity committed on desolate displaced Nigerians from the North, a direct effect of Terrorism advocated to by PMB’s religious progression, and most recently the current Deputy UN appointee swindling of the International moratorium on Forrest abuses to the rate of 300 Million USD and also the Maina-gate where a man accused of ripping of retirees of their benefits was illegally pardoned and reinstated with 2 staged promotional advancement and based on his lawyer is still collection salary from the Federal republic of this amalgamated Nigeria whilst PMB is at the helm. Now who is fooling who ?

      • Tola

        So you are still in this $25b nnpc contract nonsense after Kachikwu himself has given explanations. No wonder Donald Trump is winning. We are truly in post truth world.

        • Adele Uhuru

          BS same was said about the grass cutting issue until the SGF was quietly dismissed with zero fan fare

          • takethetrain

            is this all you do?? this online bullshit, and steal?

      • Aminu Hammanyero

        Give up this sentiments without facts. There was nothing like NNPC 25 Billion fraud. NNPC simply engaged it’s subsidiary for lifting of crude rather than contracting it to third party contractors…..Read the report online!!!

        • Adele Uhuru

          Oh please next thing you will say there was no MTN under the table settlement to reduce the infraction cost, or the grass cutting contract fraud never happen also ?

        • Adele Uhuru

          Says the blind fellowship of mindless buhari worshipers

  • Steve

    Another excellent, daring and daunting piece of investigative journalism form Premium Times. Delloite is a world renowned reputable auditing firm, so these rogue Nigerian lawyers can deny it all they want, but we all know most foreign companies were able to perpetrate heinous business breaches because they had the backing of highly placed government officials up to the presidency. These same oil firms dare not carryout these illegalities in their own countries as they know it comes with grave consequences.

    • Adele Uhuru

      It is even worst now – look at MTN settlement arrangement and terms, NNPC Baru’s illegally awarded 25.6 Billion USD, there are more but once this crazy bus ride with PMB at the helm comes to a stop you all will understand what the pillage and rape of nation’s wealth resembles- this current administration is viciously inclined to thievery by proxy…………….

      • Aminu Hammanyero

        There was nothing like NNPC 25 Billion fraud. NNPC simply engaged it’s subsidiary for lifting of crude rather than contracting it to third party contractors…..Read the report online!!!

  • pheliciti

    In Jonathan, God gave us the sample of a scourge. The corruption was all pervading.

    • Dr Bunmi Binitie

      Oh yes! God wanted us to see how terribly evil corruption is so that we might hate it anď jettison it but many have not learnt that lesson

  • Hamlet

    Why is it that this country always get dubious Attorney Generals and Ministers of Justice? Is it that all senior lawyers are this bad?

  • Tola

    I am really amazed at the way lawyers bill clients. In accounting billing must never be related to the outcome of exercise or revenue/profit of the enterprise but on the magnitude of work done.

    • takethetrain

      mine demanded cash which he had no prob stuffing in his pockets, until I demanded he do his job, only at that point did he request a retainer..corrupt
      but then he was working for you!