$1.1bn Malabu Oil Scandal: Former Nigerian AGF ‘Rat’ Adoke Implicates Obasanjo, Yar’Adua, Jonathan

Obasanjo and Jonathan

Former Nigerian Attorney-General General and Minister of Justice, Mohammed Bello Adoke has claimed innocence of any fraud in the controversial Malabu Oil Settlement Scandal, saying the transaction was approved by former presidents Olusegun Obasanjo, the late Umaru Yar’Adua and Goodluck Jonathan. Mr. Adoke, who said he was only an implementer of presidential approvals, made his claim of innocence in a letter to his successor, Attorney-General and Minister of Justice, Abubakar Malami (SAN),  the later dated March  6, Mr. Adoke’s letter was predictably heavy on complaints against the Economic and Financial Crimes Commission (EFCC), which he accused of filing spurious and malicious corruption charges against him,other individuals and companies involved in the transaction.

Mr. Adoke said he had sent the Attorney-General a detailed position paper on the transaction and also expressed willingness to provide additional explanations if required. But the former Attorney-General said having not received request for further explanation, he concluded that Mr. Malami and the Federal Government were satisfied with the steps taken to implement the Terms of Settlement and the resolution of the protracted ownership/operation dispute over the OPL 245.

Mr. Adoke said recent developments, particularly involving the EFCC are suggestive of lack of synergy between the commission and the Attorney-General’s office or a sinister plot to damage him.

“Recent actions of the Economic and Financial Crimes Commission (EFCC) to impugn the settlement which was done in the national interest, particularly their penchant to suppress facts relating to the transaction and the filing of criminal charges against me for conspiracy/ aiding the commission of money laundering offence and the latest allegations of bribe taking reveal very clearly that either your office and that of the EFCC are not working in harmony or that something sinister is going on,” stated Mr. Adoke.

He argued that EFCC’s actions connote an attempt to impugn the transaction, which was scrutinised and approved by Obasanjo, Yar’Adua and Jonathan as well as three Attorneys-General.
Mr. Adoke called on Mr. Malami to say if he had abused his office in the process leading to the final implementation of the Settlement.

Mohammed Bello Adoke

“Nigerians need to know whether your predecessors in office from 2006 to May 2015 acted in the national interest when they brokered and implemented the Settlement. It will also be instructive for Nigerians to know whether your predecessors were carrying out their personal agenda or that their respective actions were carried out with the knowledge and approval of their respective principals,” said Mr. Adoke.

He added that it is Mr. Malami’s duty to tell the public that the transaction started under Mr. Obasanjo, under  whose administration the Terms of Settlement were brokered. The executor of the terms, stated Mr. Adoke, was Mr. Bayo Ojo (SAN), who was the Attorney General. He performed this role before the tenure of Mr. Jonathan, who approved the final implementation of the Terms of Settlement. Mr. Adoke said he was similarly an executor of the resolution agreements, especially because the whole process and its implementation were domiciled with the Ministry of Justice.

“The actions of the EFCC in respect of the transaction are not in the national interest, but rather in furtherance of a plot to serve the interests of some powerful families and individuals who are aggrieved by my refusal to accede to their requests to compel Malabu to pay them certain sums from the proceeds of its divestment in OPL 245, and the subsequent re-allocation of the Bloc to Shell/ENI,” Mr. Adoke told Mr. Malami.

The former Attorney-General added that he remains surprised that an agency like the EFCC is being used by people whose claim or shareholding in Malabu remains shady. “The pertinent questions that must be asked are: Why are these powerful families and individuals reluctant to litigate their dispute in the law courts if they are confident about their legal claims to the Shares of Malabu? Why are they intent on using state actors and institutions for their private benefits? Where were they when Malabu was negotiating with the Federal Government from 2006 to 2011, when the Settlement was finally implemented? Hon. Attorney General, you will be doing Nigerians a great favour by asking the EFCC, the Abacha family and other powerful individuals involved to answer these important questions,” said Mr. Adoke.

The former Attorney-General then delved into the history of the saga, which he said the EFCC has routinely circumcised. “It will be recalled that the Terms of Settlement encapsulating details of the Settlement between the Federal Government of Nigeria and Malabu Oil & Gas Limited (Malabu) was executed on 30th November 2006. The Terms of Settlement, which was later reduced to a Consent Judgment of the Federal High Court, Abuja, was brokered by our predecessor in office, Chief Bayo Ojo (SAN)and signed on behalf of the Federal Government of by the then Honourable Minister of State for Petroleum Resources, Dr. Edmund Daukoru, during the administration of President Olusegun Obasanjo,” recalled Mr. Adoke.

He explained that when he assumed office in April 2010, he inherited a Consent Judgment, which had been scrutinised by three presidents and Attorneys General. The situation, he claimed,restricted him to the implementation of the settlement,as the ownership of OPL 245 had already been resolved in favour of Malabu by the Terms of Settlement of  November 30 2006 and the Consent Judgment.of “I also inherited an ongoing Investor/State Arbitration at the International Centre for the Settlement of Investment Dispute (ICSID) in which SNUD had initiated arbitral proceedings against the Federal Government, claiming damages in excess of $2 billion for taking back OPL 245 re-awarded to them when Malabu’s title was initially revoked by the Federal Government. SNUD’s claims were also premised on the fact that they had substantially de-risked the bloc,” he stated.

Malabu, he added, was allocated OPL 245 in April, 1998 and appointed SNUD as its technical partner, with the two companies executing relevant agreements,including a Joint Operation Agreement in 2001. “Records indicate that SNUD took 40% participating interests in the venture in a farm-in agreement and also signed agreement with Malabu as its technical partner for the venture.Although Malabu was issued a license for Block 245 in April 2001, the same licence was subsequently revoked by the Federal Government on 2nd July, 2001. Exxon-Mobil and Shell were invited in April 2002 to bid for OPL 245 despite subsisting contractual agreements between Malabu and SNUD with respect to OPL 245,” narrated Mr. Adoke.

This, he added, left Malabu dissatisfied. Malabu then argued that the circumstances leading to the revocation of its licence on Block 245 was opaque and in connivance with SNUD.

Malabu also argued that Federal Government’s decision to re-award OPL 245 to SNUD was fishy, a situation that made it petition the House of Representatives Committee on Petroleum to look into the matter.

“It is apposite to note that the House of Representatives Committee on Petroleum found no rational basis for the revocation and reprimanded Shell for its complicity. The Committee also directed the Federal Government to withdraw the re-award it made to Shell and return OPL 245 to Malabu, the original allotee of the bloc.  Malabu also instituted Suit No. FHC/ABJ/CS/420/2003 before the Federal High Court, Abuja to enforce its claim to OPL 245.Although, the suit was struck out, Malabu lodged Appeal No. CA/A/99M/2006 before the Court Appeal, Abuja, Division,” Mr. Adoke further said. While the appeal was pending, he added, an amicable settlement was entered into between Malabu and the Federal Government and in compliance with the Terms of Settlement executed by the Parties on the 30 November, 2006, OPL 245 was fully and completely restored to Malabu in consideration for its withdrawal of the Appeal.

Dissatisfied, SNUD kicked off arbitral proceedings against the Federal Government’s decision to restore the bloc to Malabu at the International Centre for the Settlement of Investment Disputes,Washington DC. SNUD followed it up by making representations to government on the impending arbitration. “It is instructive to note that SNUD’s claim before ICSID was in excess of $ 2 billion. It also commenced a suit against the Government before the Federal High Court, Abuja. Although several meetings were held between the Presidency, Ministry of Petroleum Resources, SNUD and Malabu, to resolve the dispute, no satisfactory outcome was achieved,” claimed Mr. Adoke.

Further attempts at resolving the dispute, he said, were also unsuccessfully  made in 2007. This took the shape of a committee comprising the Minister of State, Petroleum Resources; the Attorney-
General of the Federation and Minister of Justice, Minister of Energy, Group Managing Director, NNPC and Directorate of Petroleum Resources (DPR) This was under the late President Yar’Adua.

SNUD, said Mr. Adoke, had entered into a Production Sharing contract with the NNPC in 2003 upon which its claim to OPL 245 was anchored. The company had also paid $1million m out of the $210 million  signature bonus to the Federal Government, keeping the balance of $209 million in an Escrow Account with J.P. Morgan. The account was jointly managed by the Federal Government and SNUD pending the resolution of the dispute between Malabu and the Federal Government.

With the coming into office of President Jonathan in 2010, Malabu again, petitioned the Federal Government to implement the terms of the out-of-court settlement of 30 November, 2006, the reason for which it withdrew an appeal against the dismissal of its case by the Federal High Court, Abuja.

This, observed Mr. Adoke, made government take cognisance of the pending cases instituted by SNUD against it and/or Malabu. These included “Bilateral Investment Treaty (BIT) arbitration No. ARB/ 07/18, pending at the ICSID Arbitration, to enforce SNUD’s rights to exclusively operate Block 245 as Contractor on the basis of the 2003 PSC betweenNNPC and SNUD and the financial implications of defending these actions on the public purse and opted for amicable resolution of the dispute”.

In order to satisfactorily resolve the claims and counter-claims,noted the former Attorney-General, the accent  was placed on the 30 November, 2006 Terms of Settlement, which had been reduced to orders of the court.

Similarly, to accommodate the various  interests, a Resolution Agreement dated 29 April, 2011 was executed. Under the agreement, the Federal Government agreed to resolve all the issues with Malabu in respect of Bloc 245 amicably and Malabu also agreed to settle and waive all claims to any interest in OPL 245.
“In furtherance of the Resolution Agreement, SNUD and ENI agreed to pay Malabu through the Federal Government, acting as an obligor, the sum of $ 1,092,040,000 billion in full and final settlement of any and all claims, interests or rights relating to or in connection with Bloc 245 and Malabu agreed to settle and waive any and all claims, interests or rights relating to or in connection with Block 245 and also consented to the re-allocation of Block 245 to Nigerian Agip Exploration Limited (NAE) and Shell Nigeria Exploration and Production  Company Limited (SNEPCO), stated Mr. Adoke.

He then argued that the role played by the Federal Government, its agencies and officials in the transaction was essentially that of facilitator of the resolution of a long standing dispute between Malabu and SNUD. He said he only carried out presidential approvals, thereby doing no wrong.

“I anxiously want to know where I went wrong that I have been singled out by the EFCC for prosecution. I also want to know the effect of Section 5 of the Constitution of the Federal Republic of Nigeria, 1999 as amended with respect to the vesting of all the Executive powers of the Federation in the President to exercise by himself and or through his Ministers and appointees.

“What is the effect of Section 5 of the Constitution on persons who act pursuant to lawful Presidential approvals? This is more so as two out of the three Presidents that had the opportunity to scrutinize this Settlement (Presidents Obasanjo and Jonathan) are alive. Have they disowned the Settlement? Has our predecessor in Office, Chief Bayo Ojo (SAN) distanced himself from the Settlement he brokered? Have the Ministers of Petroleum Resources and Finance at the time of implementation of the Settlement (Mrs Diezani Allison-Madueke, and Dr. Olusegun Aganga, respectively) disowned the Settlement or their signatures?” asked Adoke.