Shell, Eni to Stand Trial in Italy over Malabu Deal

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Ejiofor Alike with agency report

A judge in Milan, Italy has ordered Royal Dutch Shell and Italian energy giant, Eni, to stand trial in Italy over allegations of bribery and corruption in the 2011 purchase of Oil Prospecting Lease (OPL) 245 from Malabu Oil in Nigeria.

The judge also ordered the other key figures such as Eni’s Chief Executive Officer, Mr. Claudio Descalzi, and his predecessor Paolo Scaroni to stand trial in the proceedings that will begin on March 5, 2018.

The companies are accused of corruption in the 2011 purchase of OPL245, an offshore oil block estimated to hold nine billion barrels of crude, for $1.3 billion.

Eni has however denied any wrongdoing in the OPL 245 transaction.
“Eni’s Board of Directors has reaffirmed its confidence that the company was not involved in alleged corrupt activities in relation to the transaction,” Reuters quoted Eni as saying in a statement Wednesday.

“Eni expresses its full confidence in the judicial process and that the trial will ascertain and confirm the correctness and integrity of its conduct,” the statement added.

The Italian giant insisted in particular that “chief executive, Claudio Descalzi was not involved in the alleged illegal conduct”.

Shell and Eni were charged with corruption in Nigeria over the OPL 245 deal, which was brokered by former President Goodluck Jonathan’s administration.

The deal saw the federal government act as an intermediary between the oil majors and Malabu Oil and Gas, a Nigerian company allegedly controlled by former petroleum minister, Dan Etete.

Allegations of corruption and bribery have mounted in the years since, forcing Shell and Eni to repeatedly maintain that they acquired the rights to the lucrative block in line with Nigerian law.

But email exchanges between Shell management cited in a report by corruption watchdog Global Witness, and seen by AFP, suggest that Shell was aware the money was likely to be funnelled to individuals, including Etete and Jonathan.

Etete was also ordered to stand trial by the Milan court.
Nigeria’s anti-graft agency filed corruption charges against Shell and Eni in March, accusing 11 defendants, including Etete, of “official corruption” in connection with the oil block deal.

Jonathan has denied receiving kickbacks, saying in January that he has not been “accused, indicted or charged for corruptly collecting monies” linked to the deal.

OPL 245 has been a source of contention for almost two decades.
In 1998, the block was awarded by then petroleum minister, Etete to Malabu Oil and Gas.
Years of legal wrangling between Malabu, the Nigerian government and Shell ensued, with Shell ultimately winning rights to the block in a partnership with Eni.

President Muhammadu Buhari, who has promised to fight corruption in Nigeria’s oil sector, has said “mind-boggling” sums have been stolen from the public purse.

But in its reaction to the order by the Milan judge, Shell said Wednesday that it was disappointed over the decision.

A statement released on its website said Shell believed that the trial judges will conclude that there is no case against it.

“Royal Dutch Shell Plc today made the following statement in response to the decision by the judge of the preliminary hearing of the Tribunal of Milan in Italy to remand the company for trial for alleged offences related to oil prospecting licence (OPL) 245 in Nigeria,” the statement read.

“We are disappointed by the outcome of the preliminary hearing and the decision to indict Shell and its former employees. We believe the trial judges will conclude that there is no case against Shell or its former employees.
“Shell attaches the greatest importance to business integrity. It’s one of our core values and is a central tenet of the business principles that govern the way we do business.

“Shell has clear rules on anti-bribery and corruption and these are included in our code of conduct for all staff. There is no place for bribery or corruption in our company.”