Prospecting oil Licence 245, originally owned by Malabu Oil and Gas Limited, but sold to two oil companies operating in Nigeria, has spawned a web of corruption likely to haul the country into the abyss of infamy. It is estimated to be worth about $500 billion. Reported to be the country’s richest oil asset, but sold for a little above $1 billion, the oil block has spiralled into an awfully dense drama since its allocation.
A former Minister of Petroleum, Dan Etete, allocated it to a firm in which he had substantial interests in 1998, when the late maximum military ruler, Sani Abacha, was in office. The oil well was earlier entangled in an ownership dispute between Malabu and Shell Nigeria Ultra Deep, which initially came into the picture as a technical partner. A maze of litigation and agreements led to the mega oil block being returned to the Federal Government, and later sold to SNUP at about $1.3 billion. The government, in turn, settled Malabu to relinquish claim to its ownership. It was from the transaction money lodged in Nigeria’s escrow account at JP Morgan Chase, London that about $1.1 billion was paid to Etete and his allies. Nigeria then collected a paltry $210 million. A dodgy transaction of this magnitude can only happen in Nigeria.
Prosecutors in Italy in the criminal trial of some oil executives over the case say a hefty bribe of $466 million was shared among Nigerian government officials at the time. A report by Global Witness on email exchanges between oil executives has also established this. Nigeria’s paltry financial gain from the transaction will remain an issue. Simon Taylor of Global Witness – an anti-corruption body − rightly observed that, with the development, “generations of Nigerians have been robbed of life-saving services, while oil men have grown rich at their expense.”
The murky deal has triggered investigations in Italy, Holland, the United Kingdom, France and the United States. According to a court in Italy, those involved in the oil block deal were conscious of the fact that it was “fraught with fraud.” But all have denied any wrongdoing, just as Malabu and a host of indicted former Nigerian public officials have.
But the massive corruption scandal will not go away. A fortnight ago, operatives of the Economic and Financial Crimes Commission invaded the Kano residence of the immediate past Attorney-General of the Federation and Minister of Justice, Mohammed Adoke (SAN), to conduct a search. He had led the government team that brokered the deal, which resulted in the sale of the controversial oil well in 2011.
In a twist that further exposes the underbelly of the scandal, Mohammed, Abacha’s son, has filed a suit at a Federal High Court Abuja, praying it to declare him and Pecos Energy Limited the supposed authentic owners of the oil block. The EFCC is also in court, with charges of fraud against nine persons associated with the bizarre deal. But can the country be serious in bringing the bribe-takers to book?
The toxic nexus between business and government explains why the country is failing. Before the Malabu oil bribery, there were the Siemens and Halliburton scams. Trials have long been concluded in the Halliburton bribery in the US, France and the UK, suspects convicted and jailed; and the US harvested over $1.5 billion in fines imposed on the firm involved. But despite the findings of a special panel headed by the then Inspector-General of Police, Mike Okiro, in 2010, which detailed the beneficiaries of the $132 million bribe, our government never acted. The then chairman of the EFCC and representatives of the State Security Service and National Intelligence Agency served on the committee.
Such a prostrate disposition by government in corruption cases that involve the mighty explains why even a cautious optimism is difficult to express with the legal action the EFCC has taken so far on Malabu. The anti-graft war in the country cannot make headway if the government always develops cold feet anytime questions of abuse of office by former rulers and our discredited ruling class feature in scandals. Four previous heads of state were allegedly involved in the Halliburton mess; just as some have also been fingered in the Malabu saga.
The EFCC should, therefore, end this circus by proving with this case that nobody is above the law, no matter how highly placed. This was what South Korea did when it impeached its first female president, Park Geun-hye, for corruption late last year. She is undergoing trial that could earn her life imprisonment. This is how to fight corruption.
Questions of probity and accountability have been dredged up with Etete and Abacha’s son’s claims to the ownership of OPL 245. Observers argue that Etete, as a minister, acted as a proxy for Abacha in getting the oil block. That is plain corruption and abuse of office if it is proved to be true. The law that gives the President or the Petroleum Resources Minister the discretion to dispense oil blocks or licences does not also direct him to illegally appropriate any. But this is what OPL 245 seems to be all about: conspiracy and official corruption at the highest level. It cannot stand any legal scrutiny.
Nigerians must be ready to hold government to account. Brazil was engulfed in unrest for weeks over a huge kickback and bribery scandal at the state-owned oil giant, Petrobras. Apart from landing dozens of the country’s top business elite in jail, investigations into the epic graft scandal, nicknamed Operation Carwash, have ensnared at least five members of the cabinet, the heads of both houses of Congress and former Presidents Luiz Inacio Lula da Silva and Dilma Rousseff.
The Minister of State, Petroleum Resources, Ibe Kachikwu, has said that “Malabu is a mess.” He should, therefore, step up government’s efforts to dredge this corruption swamp. No oil well is ever sold without the knowledge of its commercial value, which ultimately determines the signature bonus to be paid. And how much did Malabu pay in this regard? A token of $2 million. This is absolutely incredible! If truly the disputed OPL 245 holds reserves of about 9.23 billion barrels of oil, valued at about $500 billion, those who cornered it, sold it for the benefit of Malabu and a litany of corrupt Nigerian public officials really have questions to answer.
