30 November 2018

Nigeria: Malabul Oil Deal - Nigeria Risks Losing $10 Billion - Reps

The House of Representatives Committee on Financial Crimes says Nigeria stands the risk of losing $10 billion from the controversial Oil Processing Licence (OPL) 245 deal.

This is even as experts in the oil industry have sought a review of the controversial deep water oil block agreement.

Campaign group, Global Witness, in a report released on Monday, said the contract was altered in favour of Shell and Eni thereby depriving Nigeria of $6 billion in estimated potential revenues.

Speaking in Abuja at the anti-corruption situation room on public presentation of expert analysis of OPL 245 deal by the HEDA Resource Centre, in partnership with Global Witness, Er-Common and CornerHouse, the chairman of the House of Representatives Committee on Financial Crimes, Kayode Oladele, said the figure would have risen to about $10 going by today's global economic standards.

Reports of various other studies from the oil sector experts put the projected loss to Nigeria at $4.5b, $6b, $9.8b and $10b based on the lopsided Production Sharing Agreement that excluded some key components of the license, like gas.

He said the recent investigation by the House unearthed shady deals facilitated with alleged payment of $1.1 billion to a former petroleum minister, Dan Etete, as well as other inconsistences in the Production Sharing Agreement (PSA) that did not favour Nigeria.

He said the House reopened the investigation having realised that the $1.1b paid by Shell and Agip for OPL 245 was disguised as payment to the Nigerian government, "when it is common knowledge that the only entitlement of the Federal Government in the award of oil block is signature bonus, while the beneficiary of the award (in this case, Malabu) is entitled to the full value of the block ($1.1 billion) if it divests its stake."

Presenting the Global Witness, Er-Common and CornerHouse report, Don Hubert said the concern should be about the fact that Nigeria was losing a huge chunk of her revenue from the OPL 245 deal.

HEDA Director, Olanrewaju Suraj, asked the Federal Government to revoke the license to prevent a further loss of revenue.

He said: "Nigerians established that this is absolutely a corrupt process and you all know you can't build something unlawful and this is a criminal process, no matter how beautiful the product is you can't make it sacrosanct."

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Nigeria Loses $6bn in Malabu Oil Deal, Says Report

Global Witness said it had spent years investigating the deal, which gave Shell and Eni the rights to explore OPL 245,… Read more »

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