Oil & GasTop Story

Resolve litigation on $1.3bn Malabu OML 245 deal, Pres. Tinubu orders AGF, Lokpobiri, others

"The Minister of State for Petroleum Resources said parties to the deal are currently negotiating to end the over-28-year crisis and litigation surrounding the prolific oil block in the next one month"

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President Bola Tinubu has given a marshing order to the Attorney-General of the Federation and Minister of Justice, Chief Lateef Fagbemi (SAN), the Minister of State for Petroleum Resources, Mr. Heineken Lokpobiri, and other agencies of government to clear all court cases on the prolific $1.3 billion deepwater OML 245 oil block located in the southern Niger Delta.

Persecondnews reports that other agencies that also received the order include the Economic and Financial Crimes Commission (EFCC), the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and the Nigerian National Petroleum Company Limited (NNPCL).

Mr. Lokpobiri disclosed in Abuja that the block has been idle for 28 years, and if activated, it can “add so much value to our economy, so let’s see how we can resolve the problem.”

The Petroleum Resources Minister said parties to the deal are currently negotiating to end the over-28-year crisis and litigations surrounding the prolific oil block in the next one month.

The Malabu OML 245 deal and subsequent litigations with the Nigerian government are complex and long-standing sagas involving allegations of corruption, fraud, and legal battles.

The oil block in question, OML 245, is considered one of Nigeria’s most prolific oil blocks. In 1998, Malabu Oil and Gas, a company with links to former Nigerian Minister of Petroleum Dan Etete, acquired the block for $2 million.

In 2001, the Federal Government under former President Olusegun Obasanjo revoked Malabu’s licence due to “questionable practices.”

In 2006, Malabu challenged the revocation in court, eventually reaching an out-of-court settlement with the government under former President Umaru Yar’Adua.In 2011, Shell and Eni, two major oil companies, acquired the block for $1.3 billion from Malabu in a deal approved by the Nigerian government.

But since then, there have been allegations and litigations, as Transparency International and other anti-corruption groups alleged bribery and corruption in the deal, with funds allegedly funnelled to Nigerian government officials.

This resulted in litigations involving Nigeria versus Eni and Shell, as the Nigerian government under former President Muhammadu Buhari pursued legal action against Eni, Shell, and Malabu, alleging corruption in the deal.

Commenting on the issue, Lokpobiri said:“The previous administration initiated most of the cases that we are talking about today, and they took us to court, while we took Eni, Malabu, and others to different courts in Europe, Canada, etc.,but we didn’t win any of the cases.

“To even shock you, there is one that got us a penalty of over 70 million pounds. How did that happen?

”He explained that JP Morgan sued the government for trying to dent its image in the saga, adding that the penalty was now binding on Nigeria.

“So we have been fined over 70 million pounds by the court. Who will pay that? You and I will pay that, or our children will pay, because it is a judgment debt. And in all the ones that we pursue both in Switzerland and other locations, we have no evidence to get conviction.

“And so it makes sense for this government to come and say that for 28 years, this block has been idle. This block is a prolific block that will add so much value to our economy, so let’s see how we can resolve the problem.

“So we are talking to Eni and Shell and saying, let’s sit down and see how we can resolve all the problems. We have taken you to court on multiple occasions; you have also taken us to court, but let’s see how we can resolve these problems,” the minister said.

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