The ongoing criminal trial of Shell, a Dutch-British oil and gas company and Eni for corruption in the $1.1bn OPL 245 oil deal threw up a bombshell as Italian prosecutor emphasized that the oil giants knew that most of the money they spent to buy the Nigerian oilfield in 2011 would go into corrupt payments to politicians and officials.
This trial resumed in the Milan Court after a 4 months break due to the Covid-19 pandemic with prosecutors in their closing statements, laid out their account of how the $1.1bn OPL 245 deal played out.
“They were kickbacks. And Eni and Shell knew it,” Sergio Spadaro told judges in Milan, summing up the prosecutors’ case in what is one of the industry’s largest corruption scandals ever.
During the 7-hour speech in a special courtroom to meet COVID-19 requirements, Spadaro read out a series of emails between former Shell managers, including one saying it had been taken for granted Etete would have only kept a part of the price for himself, using the rest to pay off Nigerian politicians.
The prosecutor also casts doubt on the former Eni executive Vincenzo Armanna’s explanation for the nearly $1m he received from former Attorney General of the Federation, Bayo Ojo. Armanna had claimed that this was an inheritance from his father involving a gold deal.
The prosecutor has one more hearing to finish their concluding arguments.
Italy’s Eni and Shell, who deny any wrongdoing, bought the OPL 245 offshore field in 2011 for about $1.1 billion from Malabu, a company owned by former Nigerian Minister of Petroleum, Dan Etete.
Besides the two companies, another 13 people are involved in the case including current Eni Chief Executive Claudio Descalzi and former Shell head of upstream Malcolm Brinded.
All the defendants have denied any wrongdoing, saying the purchase price was paid into an official Nigerian government account with all subsequent transfers being beyond their control.
In a statement on Thursday Eni said it had paid the Nigerian government a fair and reasonable price for the field in a clear and transparent way.
“Eni did not know, nor was obliged in any way to know, the final destination of the funds subsequently paid to Malabu by the Nigerian government,” it said.
Prosecutors allege that about $1.1 billion of that money was siphoned off to politicians and middlemen, half of it to Etete himself.
Prosecutors are expected to make their final sentencing requests for those involved in the long-running case at a second hearing in Milan scheduled for July 21.
The controversial Malabu deal was struck in 2011 under former President Goodluck Jonathan. The arrangement saw the Nigerian government stand as a negotiator in the controversial sale of the oil block in offshore Nigerian waters.
Two international oil firms, Shell and Eni, paid out about $1.1 billion to Nigerian government accounts in the UK which then transferred most of the money to Malabu, a company then allegedly controlled by Nigeria’s former petroleum minister, Dan Etete.
It was Mr. Dan Etete’s Malabu that allegedly transferred the over $500 million to accounts controlled by Abubakar Aiyu, who is also being prosecuted in Nigeria for his role in the scandal.
The payout immediately became a subject of cross-border investigation spanning over six countries. Several Nigerian government officials were believed to have received several millions of dollars in bribes for the enabling roles they played.