Adoke: I Did Not Lead the Team That Brokered Malabu Deal

0
1851
Bello Adoke

By Davidson Iriekpen

Former Attorney General of the Federation and Minister of Justice, Mr. Mohammed Bello Adoke, yesterday said he did not lead the team that brokered Malabu Oil deal.

Adoke who was responding to an editorial by a national newspaper, said while he agreed that government should ensure an end to the Malabu saga, it was erroneous that he led the government team that brokered the deal, which resulted in the sale of the controversial oil well in 2011.

The former AGF in a statement by his media aide, Victor Akhidenor, said he had on several occasions reiterated that the Malabu transaction preceded his tenure in office.

“It will be recalled that Adoke had on several occasions reiterated that the Malabu transaction preceded him in office. The initial allocation of the Block 245 took place in 1998 when the administration of General Sani Abacha in pursuance of its policy of promoting indigenous participation in the upstream sector of the oil industry allocated it to Malabu Oil and Gas Limited (Malabu).

“He had also clearly stated that in 2001 the administration of President Olusegun Obasanjo revoked OPL 245 and re-allocated it to Shell Ultra Deep Limited (Shell), Malabu’s technical partners when they were initially allocated the block in 1998. It was Malabu’s dissatisfaction with the revocation that led to series of litigation between it and the Federal Government of Nigeria Shell, aware of the pending litigation paid only $ 1million out of the $210 signature bonus that was fixed by the administration of President Obasanjo to the government and warehoused the balance of  $209 into an escrow account jointly managed by Shell and the FGN.

“Adoke has also made it clear that in 2006, Malabu and the FGN reached a settlement, which was reduced to a consent judgment of the Federal High Court, Abuja. Under the terms of Settlement Agreement dated November 30 2006, the FGN agreed to restore OPL 245 to Malabu and Malabu agreed to withdraw its pending litigation against the FGN. 

“However, Shell was dissatisfied with this arrangement and commenced Investor/State arbitration before ICSID claiming over $2 billion as damages from the FGN.

“It is instructive to note that at the time of Adoke’s involvement in 2011 the following issues were settled:

(a) the title to OPL 245 was already vested in Malabu Oil and Gas Limited;

(b) the signature bonus of $210million was already fixed by the administration of President  Olusegun Obasanjo, and Shell had already paid $1million and kept the balance of $ 209 in an escrow account jointly managed by Shell and FGN with JP Morgan;

(c) the FGN was exposed to a potential liability of over $2 Billion arising from the investor/state arbitration instituted by Shell before ICSID; (d) OPL 245 could not be operated because Malabu was unable to get a technical partner as a result of the caveat that Shell had put on the block.

Adoke’s involvement in the transaction as a facilitator was to ensure that the FGN was released from the contingent liability arising from the arbitration instituted by Shell, which claimed to have de-risked the block at substantial cost with the knowledge and approval of the government. Adoke maintains that if government had not allowed Shell to de-risk the block while litigation was pending, Shell would have had no basis to claim such huge sums in damages from the FGN.

To resolve the contending issues government agreed to act as facilitator to ensure that Malabu relinquished its title to OPL 245 and the re-allocation of same to Shell/ENI. The FGN was thus entitled to its signature bonus of $210 million as fixed by the administration of President Obasanjo; Malabu as owner of OPL 245 got the proceeds of its sale of the Block and Shell/ENI paid Malabu the agreed sum they had negotiated among themselves. These were the issues that were facilitated by the FGN and duly reflected in the OPL 245 Resolution Agreement and Re-Allocation Agreement of 2011.

“Adoke did not receive any bribe from anyone in respect of the transaction or any other transaction that he was involved on behalf of the FGN in his capacity as AGF. He maintains that he did not initiate or broker the Malabu transaction as stated in the editorial but merely acted as a facilitator on behalf of the FGN.”