Shell admits it knew about Nigeria bribe cash

SHELL has admitted that it knew the money it paid to acquire oil block OPL 245 in Nigeria would go to a company owned by then Nigerian oil minister Dan Etete, and not to the Nigerian government.

In 2011, Shell and Italian firm Eni paid US$1.3bn to buy OPL 245, ostensibly to the Nigerian government. However, the money ended up with a company called Malabu Oil and Gas, owned by Etete. This money was then used to pay bribes and settle disputes. Yesterday, the anti-corruption charities Finance Uncovered and Global Witness alleged that Shell knowingly took part in this bribery scheme, publishing a number of damning leaked emails between senior executives, in a report entitled Shell knew. Shell and Eni are under investigation by authorities in Italy, the Netherlands and Nigeria over their conduct.

Both companies have consistently denied knowing that the money would go to Etete and Malabu. Just hours before Shell’s dramatic U-turn, an Eni spokesperson told The Chemical Engineer that: “Neither Eni nor Shell paid any monies other than as contemplated and recorded by the Block Resolution Agreement and did not pay Malabu, to Chief Dan Etete or to any public officer.”

Meanwhile a Shell spokesperson reiterated to The Chemical Engineer: “If the evidence ultimately proves that improper payments were made by Malabu or others to then current government officials in exchange for improper conduct relating to the 2011 settlement of the long-standing legal disputes, it is Shell’s position that none of those payments were made with its knowledge, authorisation or on its behalf.”

Last night, however, Andy Norman, vice president for global media relations at Shell, changed the company’s position completely. He told the BBC that the company had made repeated attempts to understand Malabu’s ownership structure.

“Over time it became clear to us that Etete was involved in Malabu and that the only way to resolve the impasse through a negotiated settlement was to engage with Etete and Malabu, whether we liked it or not. This was consistent with the federal government of Nigeria’s (FGN) position,” he added. “From the complex multi-party negotiations that followed, we knew the FGN would compensate Malabu to settle its claim on the block. We believe that the settlement was a fully legal transaction with the FGN.”

Simon Taylor, the founder of Global Witness said that the situation showed that Shell has “knowingly deprived” the Nigerian people of funds and repeatedly misled its investors and the public.

“This is a huge U-turn that reveals Shell’s duplicity. For six years it has asserted it only paid the Nigerian government, insisting it has ‘never been anything but transparent’ about the deal for the oil block, and that its actions were ‘morally OK’. Now its private emails have come to light, Shell has admitted it dealt with Etete – a convicted money launderer – to ensure it got its hands on this valuable oil block, at the expense of the Nigerian people,” he said.

An Eni spokesperson told The Chemical Engineer that the company does not respond to third party statements and added that: 'We continue to underscore the fact that Eni and its personnel have not been involved in any wrongdoing.'

Shell did not respond to The Chemical Engineer’s request for further comment.