The Federal Government of Nigeria has withdrawn its $1,100,000,000 lawsuit against Shell Plc relating to the oil prospecting license (OPL) 245 deal.
The government’s decision to end the proceedings before Italy’s highest court was confirmed by a Shell spokesperson, who stated that they were pleased with the withdrawal.
Shell’s partner in the field, Eni SpA, on Thursday, November 16, also received a letter from the government confirming the unconditional withdrawal of the claims.
The lawsuit alleged corruption in connection to the OPL 245 deal, an oil and gas project in Nigeria.
The OPL 245 saga involves the oil prospecting license, an oil block in the Niger Delta area.
It may be recalled that the oil block was initially awarded to Malabu Oil and Gas Ltd in 1998, owned mainly by Mohammed Abacha and Dan Etete who was the petroleum minister at the time.
Subsequently, there were changes in ownership, legal disputes, and government interventions.
The former President of Nigeria, Olusegun Obasanjo, in July 2001, revoked Malabu’s license and assigned the oil block to Shell without a public bid.
Thereafter, they went to court and the ownership was reverted in 2006 after the company reached an out-of-court settlement with FG.
Shell fought back and commenced arbitration against Nigeria, but when former president Goodluck Jonathan came to power in 2010 and implemented the consent judgment, returning the oil block to Malabu, the controversy appeared to have been resolved with Shell and Eni agreeing to buy the oil block from the Nigerian company for $1.1 billion.
The oil companies also paid the sum of N172,892,000,000 as a signature bonus to the government.
However, activists launched an international campaign alleging that the OPL 245 deal was fraudulent and that the proceeds were used to bribe government officials.
When former President Muhammadu Buhari came to office in 2015, his administration started a series of litigation against Royal Dutch Shell, Eni/Nigeria Agip Exploration (NAE), Shell Nigeria Ultra Deep (SNUD) Ltd, and Shell Nigeria Exploration Company (SNEPCO) over the allegations.
A UK court declined the jurisdiction in a case filed by Nigeria against Shell/SNUD and Eni asking for compensation, on May 22, 2020.
An Italian court, on March 17, 2021, acquitted Shell, Eni, and all defendants of corruption charges in the $1.1 billion deal.
Meanwhile, Nigeria has already filed a London case against US bank JP Morgan for its role in transferring over $800 million of Government funds to Etete, who has been convicted of money laundering.
In another separate trial, a Milan court in September found a middleman guilty of corruption after prosecutors alleged he had received a mandate from Etete, who has denied any wrongdoing, to find a buyer for OPL 245, collecting $114 million for his services
In April 2020, the US Securities and Exchange Commission (SEC) closed its investigation into the deal after it could not prove fraud or corruption.
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