Nigeria’s oil industry is going through some criminal cases which involves $1.3 billion payment supposedly meant for oil rights but being suspected to have turned into bribery for allocation of oil blocks in the country’s Niger Delta region.
It was gathered that Shell and Eni made payment of $1.3 billion for oil rights to a top oil executive in Nigeria. The payment was said to be made in an exclusive hotel in Milan, Italy.
The investigation going on now is to unravel whether the $1.3 billion paid for the license for the oil field was a bribe or official acquisition of exploration rights. The investigation was said to have reached the highest hierarchy of the executive ranks of Royal Dutch Shell RDS.B 1.94% PLC, the second-largest Western oil company—including wiretaps on its chief executive—and into Eni E 2.08% SpA, Italy’s state-backed oil company.
Italian prosecutors say Claudio Descalzi, the senior Eni executive at the Milan dinner, and high-level Shell officials approved an arrangement that allowed them to pay the government while knowing most of the money would be transferred to a company controlled by Dan Etete —the ex-oil minister Mr. Descalzi met that night, according to court documents. The prosecutors say executives knew Mr. Etete would pay off Nigerian officials and send kickbacks to Eni executives. A criminal trial begins in Milan on March 5.
The case is a rare example of top executives from giant Western oil companies facing accountability for corruption. Scrutiny of foreign bribery is growing. More than 500 ongoing investigations were taking place in member countries of the Organization for Economic Cooperation and Development in 2016, up about 25% from 2015, according to the 35-nation group’s latest analysis.
British authorities are investigating alleged oil-industry bribes in Iraq, and the U.S. has sought to recover more than $100 million as part of a wide-ranging investigation into oil-industry corruption in Nigeria.
The amount of money that allegedly changed hands in the Eni-Shell case could prove to be one of the oil industry’s largest ever bribes, said Global Witness, a London nonprofit that investigates allegations of wrongdoing in the resources industry.
Flow of Funds
Prosecutors allege Shell and Eni agreed to pay $1.3 billion to Nigeria for the rights to a valuable offshore oil field, knowing that the government would funnel $1.1 billion of that amount to a company called Malabu to be used for bribes.
Business6 days ago
Business6 days ago
Politics4 days ago
Trending Stories1 week ago
Latest1 week ago
Business3 days ago
Sports1 week ago