• Home
  • Nigeria Cannot Win OPL 245 Court Cases – Minister of Justice tells President Buhari

Nigeria Cannot Win OPL 245 Court Cases – Minister of Justice tells President Buhari

The Attorney-General of the Federation (AGF) and Minister of Justice, Abubakar Malami, has recommended that Nigeria terminates all court cases relating to OPL 245 to enable the country enjoy the economic benefits of the controversial oil block. In a memo to President Muhammadu Buhari, Malami highlighted the negative economic consequences for Nigeria, “particularly in terms of foreign exchange earnings, loss of tax income and royalty payments.” OPL 245 is believed to be Nigeria’s most endowed oil block, and its development has been stalled since Buhari came to power in 2015. His administration has been pursuing a series of litigation at home and abroad against Royal Dutch Shell, Eni/Nigeria Agip Exploration (NAE), Shell Nigeria Ultra Deep (SNUD) Ltd, and Shell Nigeria Exploration Company (SNEPCO), as well as Mohammed Bello Adoke, former AGF, over allegations of fraud and corruption in the OPL 245 deal. They all deny the charges.

In 2011, Shell and ENI paid $1.1 billion to acquire a 100% stake in OPL 245 after Malabu, the original allottee, relinquished its interest in the acreage. However, foreign anti-corruption campaigners alleged that the transaction was shrouded in corruption. The federal government has pursued both criminal and civil cases and has lost in foreign jurisdictions, but the prosecution has continued in Nigeria using the same evidence that failed abroad. The cases in Nigeria are being prosecuted by the Economic and Financial Crimes Commission (EFCC).

Malami reminded Buhari of the string of losses Nigeria has suffered over the years in trying to prove corruption and fraud in the transaction. These losses include: judgment of the UK Courts delivered on 22 May 2020, declining jurisdiction in a case filed by FGN against Shell/SNUD and ENI, asking for compensation in the sum of $1.1 billion in relation to their conduct in the OPL 245 2011 Resolution Agreements; judgment of the Italian Constitutional Court dated 17th March 2021, in the Prosecution of NAE in Milan, Italy, for international corruption allegedly connected with OPL 245 2011 Resolution Agreements which was concluded in favour of ENI; judgment delivered by the UK Court in June 2022, the FGN lost its $1.7 billion claim against JP Morgan Bank over transfers of proceeds from the sale of OPL 245 pursuant to the OPL 245 2011 Resolution Agreements; the US Department of Justice previously investigated the OPL 245 2011 transaction and announced in October 2019 that it was closing the case. In April 2020, the US Securities and Exchange Commission also closed investigation into the controversial OPL 245 deal after it could not prove fraud or corruption.

The AGF recommended that President Buhari should note that OPL 245 is the most priced oil block in the country, and FGN has gained certain benefits from SNUD/NAE/ENI in respect of OPL 245. In particular, SNUD/NAE/ENI have made payments to FGN and also expended resources thereon, including a cumulative total of $210 million Signature Bonus; approximately $500 million committed by SNUD into the development and de-risking of OPL 245; payment of $1,092,040,000.00 to Malabu as consideration for the OPL 245 2011 Resolution Agreements, and litigation cost of prosecuting the several suits connected with the subject matter in various jurisdictions. He also noted that by allowing SNUD to alter its position in the sums stated above, and without getting a corresponding value for same over.

Leave a Reply