Eni, Shell aware of $1.3b Malabu oil deal, says Italian judge

An Italian judge, Giusy Barbara yesterday said oil groups Eni and Royal Dutch Shell were fully aware that their purchase of a Nigerian oilfield in 2011, would result in corrupt payments to politicians and officials.

Italy’s Eni and Shell bought the OPL 245 offshore field for about $1.3 billion in a deal that spawned one of the industry’s largest corruption scandals.

It is alleged that about $1.1 billion of the total was siphoned to agents and middlemen.

The Milan judge made the comment, while giving her written reasons for the September conviction of Nigerian Emeka Obi and Italian Gianluca Di Nardo.

They were both middlemen in the OPL 245 deal in a corruption trial where they were jailed for four years.

“The management of oil companies Eni and Shell were fully aware of the fact that part of the $1.092 billion paid would have been used to compensate Nigerian public officials who had a role in this matter and who were circling their prey like hungry sharks.

“It was not mere connivance, but a conscious adhesion to a predatory project damaging the Nigerian state,” the judge said in her reasoning.
She also said money was given to some Eni managers, according to a report by Reuters.

Obi and Di Nardo have been tried separately from Eni and Shell, which also face corruption allegations over the same deal in a hearing that is expected to drag on for months.

Eni said it would analyse the judge’s remarks, noting that a fuller account of the facts and evidence surrounding the deal would emerge only from the main trial.

While the Italian company has previously denied any wrongdoing, Eni shares fell slightly on the judge’s remarks, but quickly recovered ground, even as Shell’s stock was barely changed.

Under the deal, Eni and Shell jointly acquired the OPL 245 field from a company owned by former Petroleum Resources Minister, Dan Etete who, the judge noted, had been put under investigation in 2003 in France for alleged money-laundering.

Shell, however said neither Obi, nor Di Nardo had worked for Shell, and that there was no basis to convict it or any of its former staff of alleged offences related to the oil deal.

Eni Chief Executive, Claudio Descalzi and four ex-Shell managers, including former Shell head of upstream Malcolm Brinded, are also accused of international corruption in the main trial. They have all denied any wrongdoing.
Brinded’s lawyer referred requests for comment to Shell.