An Italian judge has ordered oil majors Royal Dutch Shell and Eni to stand trial over alleged corruption, in a case involving the 2011 $1.3 billion purchase of an offshore oil block in Nigeria that is estimated to hold 9 billion barrels of crude. OPL 245 is located offshore field richly endowed with an estimated half a trillion dollars worth of hydrocarbon deposits. The judge in Milan ordered Eni, Shell and key figures such as Eni chief Claudio Descalzi and his predecessor Paolo Scaroni to stand trial in proceedings to begin in March.
All the parties involved have previously denied any wrongdoing over the deal in which Nigeria’s former president Goodluck Jonathan and his oil minister were said to have received bribes. Both companies have repeatedly maintained that they acquired the rights to the lucrative block in line with Nigerian law.
OPL 245 was awarded to Malabu in 1998 at a time the beneficial owners were Dan Etete, then minister of petroleum resources who approved the licence, and Mohammed Abacha, son of the head of state at the time.
Their identities as the beneficial owners were later publicly revealed after the death of Sani Abacha, which effectively terminated his military regime. It was revoked in 2001 by President Olusegun Obasanjo and awarded to Shell same year, but was revoked again in 2006 and returned to Malabu following an out-of-court settlement.
President Goodluck Jonathan finally restored the block to Malabu in 2010 in a $1.3 billion deal.
But the deal has become a subject of litigation as Shell and ENI paid $1.1 billion to acquire the field from Malabu and $210 million to the federal government as signature bonus.
Both payments were made to a federal government account, leading to suspicion that Shell and ENI did not want to be directly involved with Malabu because of corporate governance issues.
Italian prosecutors believe Shell and ENI executives knew government officials were going to be bribed from the payments for their roles in getting the deal approved.
