Home Business & Economy Nigeria Sues Two Oil Giants for $1 billion

Nigeria Sues Two Oil Giants for $1 billion

Nigeria has sued Royal Dutch Shell and Italian oil giant Eni for $1.1billion at a court in London.

The billion-dollar suit has to do with the sale of an oil field in 2011, about which the Nigerian government is unhappy with how the two companies conducted themselves in relation to the deal.

In yet another demonstration of how Africa’s oil and gas resources often benefit the ruling elite, Nigeria’s former petroleum minister is believed to have had some dirty dealings with the two companies.

The oil field (OPL 245), one of the biggest in Africa, with oil reserves estimated at nine billion barrels, is currently the subject of a corruption trial in the Italian city of Milan and both former and current executives of Shell and Eni are being grilled over it.

It is alleged that the money for the sale of the oil field which was supposed to have been paid to the Nigerian government, was rather paid to a company controlled by Nigeria’s former minister of petroleum, Dan Etete. That company appears to be Malabu Oil and Gas, a Nigerian company controlled by Etete, which is another party to this suit against Shell and Eni.

“Accordingly it is alleged that Shell and Eni engaged in bribery and unlawful conspiracy to harm the Federal Republic of Nigeria and that they dishonestly assisted corrupt Nigerian government officials,”lawyers for the Federal Government of Nigeria said in a statement.

Prosecutors in Milan believe bribes of about $1.1 billion were paid for the license to the oil field – the amount that Nigeria is aiming for.

Both Shell and Eni have rejected the idea that there was illegality in their dealings with the Nigerian government.

According to Global Witness, an international anti-corruption group, the deal for oil field OPL 245 deprived Nigeria of double its annual education and healthcare budget: the misappropriated funds could have settled the Nigerian government’s education and healthcare budgets for two years.

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