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Malabu Oil Scandal: International Organisations File Appeal At The Hague, Demand Fresh Probe Of Shell

Malabu Oil Scandal: International Organisations File Appeal At The Hague, Demand Fresh Probe Of Shell Company, Managers

October 24, 2022

Three non-governmental organisations, Re:Common (Italy), HEDA Resource Centre (Nigeria) and Corner House (UK) on Monday announced that they had filed a complaint at the Court of Appeal in The Hague challenging the decision by the Dutch Prosecutors Office to drop its investigation of Shell and Shell management relating to alleged corruption in Nigeria.

The Complaint was filed by the Dutch law firm Prakken pursuant to Article 12 of the Dutch Code for Criminal Procedure.

Article 12 permits interested parties to challenge prosecutorial decisions not to investigate or prosecute an alleged crime.

In 2017, the three NGOs sought an investigation by the Dutch Prosecutors Office into Shell’s involvement in the 2011 acquisition of the exploitation rights to the Nigerian oil block OPL245. They have since submitted further concerns relating to Shell’s divestments of oil mining licences in the Niger Delta.

Separately, Shell also reported a senior manager to the Dutch Prosecutors Office for bribery relating to one of the oil field divestments.

The Dutch Prosecutors Office told Shell in March 2018 that it had evidence to prosecute the company.

Shell and other defendants, including the Italian oil multinational Eni, were prosecuted in Milan over the OPL245 deal but acquitted in 2021.

“An appeal against the judgment was withdrawn in July 2022 under controversial circumstances, although the Federal Republic of Nigeria is still contesting the judgment as a civil party.

“The judgment has been severely criticised by the Organisation for Economic Cooperation and Development (OECD), the body that acts as guardian of the OECD Anti-Bribery Convention, which provides the basis for Italy’s laws criminalising the bribery of foreign officials.[3]

“Following the collapse of the case in Italy, the Dutch Prosecutors Office announced that it would be dropping its investigations into the alleged corruption due to double jeopardy rules which do not permit prosecutions where a defendant has been acquitted for the same crime in another jurisdiction.

“Re:Common, HEDA and Corner House are challenging the Prosecutors’ decision,” the groups said in a statement.

In their court filings, they acknowledge that Royal Dutch Shell plc cannot be prosecuted for bribery in relation to the OPL245 deal (the substance of the Italian prosecution) but contend that there is sufficient evidence to warrant further investigation and prosecution for a range of other crimes, including money laundering, fencing, fraud, theft and membership of a criminal organisation.

The NGOs name two Shell companies and other high profile Shell executives (none of whom were charged in Italy) as suspects.

According to Antonio Tricarico from Re:Common, “There are overwhelming suspicions of criminality regarding this case. The rule of law demands that prosecutable crimes should be prosecuted. We urge the Dutch Public Prosecutors’ Office to step up for justice.”

“The DPO must continue its investigations and follow the evidence where it leads”, says Olanrewaju Suraju. “Justice demands nothing less.”

Nick Hildyard from Corner House notes, that “There is an overwhelming public interest in reopening the investigation. Shell should not be accorded special treatment because it is a major international company.”

The complaint was filed by Prakken d’Oliveira lawyers Barbara van Straaten and Tamara Buruma.

Recall that on April 9, 1998, the Federal Military Government of Nigeria awarded OPL 245 to Malabu Oil and Gas Limited, which was said to be owned mainly by Mohammed Abacha, the son of the late Head of State, General Sani Abacha, and Dan Etete, who served as his Minister of Petroleum. On July 2, 2001, President Olusegun Obasanjo revoked Malabu’s licence and assigned the oil block to Shell without a public bid.

Malabu went to court, and ownership was reverted to it in 2006 after it reached an out-of-court settlement with the federal government.

Shell challenged the decision and commenced arbitration against the federal government, but when President Goodluck Jonathan came to power in 2010, the controversy appeared to have been resolved with Shell and Eni agreeing to buy the oil block from Malabu for $1.1 billion.

The oil companies also paid $210 million as signature bonus to the Federal Government of Nigeria. Both payments were made to the government account at JP Morgan, London, from where Malabu’s share was transferred to Nigerian bank accounts of Abubakar Aliyu, owner of AA Oil Limited.

When President Muhammadu assumed power 2015, EFCC under Ibrahim Maga, as part of his effort to hound down officials of the previous government, in 2017, charged Adoke, Shell Nigeria Exploration Production Co. Limited, Nigeria Agip Exploration Limited, Eni Spa and seven others at the Federal Capital High Court in Abuja with various offences involving their alleged roles in the transactions in which Nigeria was said to have been defrauded of about $1.8billion.

The transactions involved the chains of transfer of the ownership of the OPL 245 covering a lucrative oil field.

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