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Malabu Scandal: Shell ‘writes down’ OPL 245 licence

Royal Dutch Shell has said that its second-quarter writedowns include the controversial OPL 245 licence at the centre of corruption trials in Nigeria, Italy and the UK.

Reuters reports that the oil giant on Thursday listed the controversial licence for an offshore oilfield in Nigeria, which it holds alongside Eni, as parts of its writedowns.

In accounting and finance, writedown refers to a reduction in the estimated or nominal value of an asset. Often, a writedown becomes necessary due to economic or fundamental changes in the value of an asset.

Last week, PREMIUM TIMES reported how Italian prosecutors proposed eight years in prison for both Claudio Descalzi, former chief executive of Eni and Paolo Scaroni, his predecessor; and a seven-years-and-four-months jail term for Malcolm Brinded, Shell’s former head of upstream.

The prosecutors also prayed the court to issue a fine of 900,000 euros ($1.04 million) each against Eni and Shell and to confiscate a total of $1.092 billion from all the defendants in the case, the equivalent of the bribes alleged to have been paid.

Sergio Spadaro, the Public Prosecutor of Milan, had earlier told a Milan court that the major parties mentioned in the controversial Malabu scandal were involved in sundry corrupt activities, adding that major Nigerian officials named in the controversial deal all had long-standing relationships.

The prosecutor requested a 10-year jail sentence for Dan Etete, a former Nigerian petroleum minister, over alleged fraud in the controversial Malabu scandal.

On Thursday, Shell said a post-tax impairment charge of $4.658 billion was “mainly related to unconventional assets in North America, assets offshore in Brazil and Europe, a project in Nigeria (OPL245), and an asset in the U.S. Gulf of Mexico.”

The Malabu scandal involves the transfer of about $1.1 billion by oil multinationals, Shell and ENI, through the Nigerian government to accounts controlled by a former Nigerian oil minister, Mr Etete.

From accounts controlled by Mr Etete, about half the money ($520 million) went to the accounts of companies jointly controlled by Abubakar Aliyu, popularly known in Nigeria as the owner of AA oil, and Mr Etete.

Anti-corruption investigators and activists suspect Mr Aliyu fronted for top officials of the Goodluck Jonathan administration as well as officials of Shell and ENI.

The transaction was authorised in 2011 by Mr Jonathan through some of his cabinet ministers, and the money was payment for OPL 245, one of Nigeria’s richest oil blocks.

Although Shell and ENI initially claimed they did not know the money would end up with Mr Etete and his cronies, evidence has shown that claim to be false.

Shell later admitted it did know the money would go to Mr Etete.

Shell, Eni, Mr Etete, Mr Aliyu and several officials of the oil firms are being prosecuted in Italy for their roles in the scandal.

PREMIUM TIMES reported how Mr Etete acquired luxury properties in Dubai with funds believed to have been sourced from the controversial deal.

In April, the EFCC was urged to seize a private jet bought by Mr Etete from money he allegedly made from the Malabu deal.

On June 6, this newspaper also reported how Nigeria tracked down and grounded the luxury private jet purchased by Mr Etete, with some of the alleged proceeds of the notorious oil deal.

Asset recovery lawyers acting for the Nigerian government swooped on the Bombardier 6000 jet, tail number M-MYNA, when it touched down at Montréal-at, the Trudeau International Airport in Canada on May 29.

Source: premiumtimesng.com