Like Mr Adoke, all parties in the Milan trial have denied the charges against them.
The lawyer representing Nigeria in the Malabu trial on Wednesday accused a former attorney general and minister of justice, Bello Adoke, of compromising Nigeria’s interest in the OPL245 deal.
Lucio Lucia, representing Nigeria at the Milan trial of the oil giants (Shell and ENI) and other individuals for the alleged fraudulent acquisition of the oil licence OPL245, made this submission as Nigeria makes its concluding arguments on Wednesday.
The lawyer reaffirmed the Nigerian government’s stance on Mr Adoke, ex-petroleum minister Diezani Alison-Madueke and former President Goodluck Jonathan in the alleged scam.
Former President, Goodluck Jonathan
“This process concerns corruptors: our rule on international corruption allows only Italian jurisdiction for obvious reasons of non-interference in the sovereignty of the victim state with respect to its public officials,” the lawyer began.
“But the Federal Republic of Nigeria (FRN) wanted to take action because of this fact, which it considers to be of very serious disvalue and of very serious prejudice to the nation.
“In addition to the decision to become a civil party in this Italian trial, the only case in international corruption trials, and in addition to providing cooperation to the Italian judicial authorities in the form of rogatory letters, the issue in Nigeria has had investigative and procedural implications.”
On Wednesday, the lawyer informed the court of “criminal prosecution in Nigeria for these acts against the corrupt, first and foremost the Attorney General Mohammed Adoke Bello, who was accused of receiving illegal compensation in exchange for licensing the oil companies, and thus arrested and extradited from Dubai for the corruption related to OPL 245”.
Mr Adoke has consistently denied any wrongdoing.
PREMIUM TIMES obtained an English translation of Mr Lucia’s presentation, done in Italian, from civil society groups who were present at the Italian court and had been monitoring trial.
Talking about the alleged illegal movement of money from escrow accounts, Mr Lucia said the payment of public officials involved in the scheme was proven and the money was followed.
He reportedly said: “The Guardia di Finanza – Italian financial police – has reconstructed the flow of money, documented in documents, that goes from the payment by Eni to the escrow 2 account in the name of the Nigerian Government of the time, through the attempted transfers made by FGN to the BSI bank and the Lebanese bank in favour of the company Petrol Service of Falcioni, then to the payment to Malabu’s accounts in Nigeria, up to the single expenses made by Etete, up to the impressive mass of money (about 500 million dollars) exchanged in cash at the bureau de change.
“The cash flow was traced to the Malabu accounts in Nigeria, at Keystone Bank (400 million) and at the First bank of Nigeria (401 million): on both accounts Etete has the signature to operate. From there the money splits and goes on the account of Rocky Top signed by Etete; and on the accounts of 4 companies related to Aliyu Abubakar, the only one authorized to operate on the accounts.”
The lawyer noted further that that Dan Etete, a former oil minister, and his family and friends have been spending a total of 124 million euros for ‘voluptuous expenses’.
“From Rocky Top, but especially from Abubakar’s companies (AE Group, Megatech, Imperial Union, Novel properties), an impressive flow of money flows to the bureau de change, the cash exchange offices,” he noted.
“This money is withdrawn and exchanged into cash in foreign currency either personally or by order of Abubakar. In this maelstrom of money, it is worth mentioning transactions traced in documents of particular interest: from AE Group and Megatech two transfers ($400,000 and $11,400,000) to Senator John I Obiorah of the Federal Republic of Nigeria; from Rocky Top 10 million dollars to Bayo Ojo, the former AG for the settlement of 2006, which heard at the hearing of 6.2.2019 says it acted as an advisor to Etete for the transfer of the OPL 245 licence.
“Cash transfers to the account of Adoke Bello, the AG in office at the time of the Resolution Agreement – RA 2011, at the Unity Bank in Nigeria. Adoke Bello buys a property in Abuja from a company of Abubakar at a much lower price than the real one ($4.5 million); and he doesn’t even pay this price. Adoke Bello receives cash payments into his current account of money from Bureau de Change for approximately $2.2 million from 15.2.2012 to 17.10.2013.”
Speaking on alleged constitutional beach of trust and oath of office by officials of the government, the lawyer argued that Mr Adoke misused the privilege he had as government official.
“But what did Adoke Bello do in return for his payments? The government that will stipulate RA 2011 starts by confirming the allocation to Malabu and therefore to Etete of 100% of all concession rights for OPL 245.
“The main actors are President GLJ (Goodluck Jonathan), Oil Minister Diezani and AG Adoke Bello, the latter two will sign the 2011 RA together with the Minister of Finance. Adoke Bello, who, in fact, will play a decisive role at the negotiating table, above all in allowing Eni/Shell to have all the contractual clauses, accepted by the IOCs – clauses unilaterally prepared by them – overcoming any objection by NNPC and DPR, the technical bodies of the Ministry of Oil.
“This is in favour of IOCs instead of doing the interests of Nigeria.” Quoting the Email of 28.2.2011 Colegate/Robinson RDS 854 “Etete spoke with GLJ and AG yesterday in Lagos and NNPC is resolved”.
On the value of the asset, the lawyer argued that for Mr Etete, “what matters is only the price (as high as possible), which is normal for the pure seller. It is much less normal in a private transaction for public officials to be interested in the price, but they should be indifferent to the price or, at most, interested in the success of the sale.”
However, he noted, the conditions of the new licence for Shell and Eni remain constantly in the background, at least in high-level negotiations between the top management of the IOCs, Mr Etete, and public officials.
“For Etete on the one hand and for Adoke Bello on the other, the contractual clauses are almost irrelevant: Etete is totally disinterested, the AG at most, but only in the end, has to save appearances and – above all – has to do everything possible to silence the NNPC and DPR technical bodies that get in the way,” he said.
Indicting the oil companies, Mr Lucio noted that for Eni and Shell, the contractual clauses are “decisive points for the deal, just as much as the price, because they have a great economic impact and will regulate the life of the licence for the next 30 years (10 OPL + 20 OML), to the detriment of the revenues of the Federal Republic of Nigeria, whose interest is pre-empted by public officials with respect to their intentions of enormous and illicit personal enrichment.”
Ultimately, he said, low prices and advantageous clauses are also a big deal for Eni and Shell, “but at the expense of Nigeria’s financial interests”.
He said: “The price (which we believe to be very low), compared to the important value of the license, has in the case in question undoubtedly a very important circumstantial significance with regard to the conduct of the parties and the defendants. It is, in essence, the motive for IOCs.
“Why embark on such a complex negotiation? Why take such significant risks from a reputational point of view (TRAG 2007 and 2010 reports)? Why force all the company’s procedures or, in any case, normal negotiating practices and sit down at the table with a former oil minister, convicted for money laundering, who has obtained the OPL 245 licence in at least dubious situations? Why should you deal with a company like Malabu for which, after a long time, you cannot even complete the due diligence required by internal compliance?
“Ultimately, why commit a serious crime such as international corruption? The answer can only be one: the deal was very interesting for the oil companies and a huge economic advantage. Under the FRN technical consultant’s advice the asset is worth at least $3.5 billion, in line with Shell’s internal analysis. The price paid of 1.3 billion was very advantageous for Eni and Shell.”
Eni, Shell aware of payments
The lawyer explained that Royal Dutch Shell (RDS) emails make it very clear that Shell and Eni are familiar with the relationship between Mr Etete and the President, Mr Jonathan, as well as the Minister and the AG, Mr Adoke.
“There are explicit emails. The offence exists because Eni and Shell are fully aware that, in order to obtain the 2011 RA in favourable terms, they essentially pay Etete and that will be paid to public officials,” he said.
“It is a real fraudulent simulation: apparently IOCs have no relationship with Malabu, but have dealt with Etete. They know perfectly well that the money paid will go to Etete to pay the public officials.
“Is it legitimate to pay an interposed person, knowing full well that the money will be paid in bribes, for obtaining illegal favours?
“It is not enough to pay into an escrow account formally in the government’s name, knowing full well that it was a roundabout game and that the money would go to Etete and from there to corrupt public officials. IOCs should have asked the government for formal reassignment of the license. The corrupt oil minister should have revoked the license in Malabu for inoperativity or failure to pay the signature bonus. Instead they reassign the licence 100% to him.”
The lawyer asserted in his submission that “the disputed conduct for which proof of guilt has been reached for all the defendants has caused serious damage to FRN, both pecuniary and non-pecuniary, image and moral damage.”
According to him, the highlight of the loss include emerging damage due to the higher signature bonus that the government would have obtained if the open tender or at least by invitatio was a base already acquired 10 years earlier; as well as loss of profit for the lesser revenues that the government or NNPC obtains with the SOLE RISK licence and the conditions of RA 2011, compared to the usual PSC.
“In essence, this RA 2011 solution instead of the PSC model deprives the government or NNPC of profit oil, as all the technical consultants, including Shell and Eni’s ones, have said: these are huge sums,” he said.
“The FRN technical consultant Rogers in paragraph 4.12 also gives account of the technical work carried out by Don Hubert of RDC. In summary, the differences in loss of earnings for FRN are 4.5 billion US dollars if, instead of the 2011 RA, the 2003 SGP had been adopted (model SGP 2000); 5.9 billion US dollars if the 2005 model CSP had been adopted instead of the 2011 RA.
“To the patrimonial damage must be added serious damage to the FRN’s image and moral damage. The offence has altered the proper management of public affairs in Nigeria, seriously affecting economic development,” he said.
“The offence has altered the economic conditions of the market in terms of competition, which is, moreover, the interest protected by the rule that punishes international corruption. All the categories of damage mentioned deserve careful and precise quantification in separate civil proceedings. We therefore request a general sentence to pay damages, with damages to be settled in separate civil proceedings.”
However, he noted, the $ 1.1 billion that Eni and Shell have allegedly deemed to spend as a price to obtain the favourable conditions provided, for the long concession period of 10 years OPL and consequent 20 OML years already contracted, is a sum that the companies “have considered understood and recovered with this corrupt contract.”
The IOCs certainly did not pay the price to lose out, he said, adding that their illicit profit and the consequent damage for Nigeria is higher than what they allegedly spent.
The lawyer argued further that the defendants must be ordered to confiscate the profit that constitute the profit of the offence, pursuant to Article 322 of the Criminal Code.
According to Barnaby Pace, oil campaigner at Global Witness, the next hearing will be on September 21 with concluding arguments from Vincenzo Armanna, a former Eni lawyer who gave evidence against his former colleagues.
The Malabu OPL245 scandal is central to a corruption trial in Italy, where Mr Etete is an accused, together with alleged middlemen, Eni and Shell, and several of their executives.
Like Mr Adoke, all parties in the Milan trial have denied the charges against them.
The Nigerian authorities have also charged Mr Etete and several others linked to Malabu with money laundering in connection with the onward flow of funds from the OPL245 deal.
Like former President Jonathan and other officials alleged to have been involved in the deal, Mr Etete has equally denied any wrongdoing and has dismissed the allegations as “political propaganda”.