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Reps, AGF clash over Malabu oil deal

Attorney-General of the Federation and Minister of Justice, Mohammed Adoke yesterday said that the Federal Government acted in good faith by facilitating the amicable settlement of a rift between Malabu Oil and Gas Company, Shell and the Federal Government for which Shell paid $1,092, 040,000 (about N172.53billion) to Malabu.

Adoke had appeared before the Adhoc Committee set up by the House of Representatives to investigate circumstances surrounding the sale of Operating Petroleum Licence, OPL, 245 Oil block. Adoke had taken exception to the line of questioning by the members of the committee which according to him suggested that his actions in the oil licence deal were questionable.

From Left: Solicitor-General of the Federationand Permanent Secretary, Ministry tf Justice, Mr Abdullahi Yola, and Attorney-General of the Federation and Minister of Justice, Mr Mohammed Adoke (SAN), At The Public Hearing of the House of Representatives Ad-Hoc Committee on Transaction Involving the Federal Government, Shell/Agip companies and Malabu oil and Gas Ltd in respect of an oil block, in Abuja on Friday (7/12/12).

He said, “I was not that irresponsible and I did not authorise the payment of money from the Federation Account to Malabu. The perception was that the Attorney-General and Minister of State for Finance connived to pay some money to Malabu.

“It is therefore quite evident from the foregoing that the role played by the Federal Government, its agencies and officials in relation to Block 245 was essentially that of facilitator of the resolution of a long standing dispute between Malabu and SNUD over the ownership and right to operate Block 245. At all times, material to the resolution of the dispute, the Federal Government was not aware of any subsisting third party’s interest in Malabu’s claim to OPL 245 and neither did any person.”

He said it was unfortunate that the petitioners had created the impression that he paid monies to Malabu illegally from the Federation Account.

When the committee probed further about the alleged questionable payment of monies to Malabu, Adoke replied, “I know where this question is coming from. Ask me and I will give you the answer. I am not a crook and I don’t support crooks.”

A member of the committee John Dyeign, ACN Benue, responded in a charged voice saying:”You are calling yourself names, Nobody is calling you such a name.”

Chairman of the committee and the Deputy Majority Leader of the House, Leo Ogor intervened and said said:”AGF, we are in the green Chamber. We do not presume. We are here on a fact finding mission. Members can ask any question, no matter how foolish you presume it is.’’

Narrating the sequence of events that led to the settlement, the AGF added, “The petition came well after the issue had been resolved and I told the petitioners to take the matter to the appropriate agencies of government . The office of the Attorney-General is not an investigative office.

“The Malabu matter has been on for 12 years and this latter day claimant did not come forward to lay claims to the oil bloc. This latter day claimant waited till after the transaction had been resolved and the issue had become irreversible before writing a petition to the AGF. The AGF advised them to approach the relevant agencies as the matter was an internal affair of Malabu.”

The AGF who explained the reason for his anger said: “I cannot be unduly maligned by people who have been the architects of the ruins of this country.”

In his presentation to the Committee he stated that “It is opposite to note that the House of Representatives Committee on Petroleum found no rational basis for the revocation and reprimanded Shell for its complicity.’’

He further explained that Malabu Oil and Gas had instituted Suit No. FHC/ABJ/CS/420/2003, before the Federal High Court,Abujato enforce its claim to OPL 245 adding that although the suit was struck out by the court, Malabu lodged an appeal before theAppeal Court,Abuja, Division.

He stated that during the duration of the appeal, an amicable settlement was reached between Malabu and the Federal Government adding that the Terms of Settlement was executed by the parties on November 30,  2006, when  the said OPL 245 was fully and completely restored to Malabu in consideration for its withdrawal of the Appeal.

Adoke further said that Shell which was apparently dissatisfied with the Terms of Settlement between the Federal Government and Malabu commenced proceedings against the decision of the government to restore/re-allocate OPL 245 to Malabu at the International Centre for the Settlement of Investment Disputes inWashingtonDC, and made representations to government on the pending arbitration.

The AGF however stated that in 2010, when the present administration came to office, Malabu again petitioned the Federal Government to implement the terms of the out-of-court settlement of November 30, 2006 on the basis of which they had discontinued their Appeal.

According to him:”Government also took cognisance of the pending cases instituted by SNUD against Federal Government of Nigeria and/or Malabu, including Bilateral Investment Treaty, BIT, Arbitration No. ARB/07/18 pending at the International Centre for the Settlement of Investment Disputes, ICSID, to enforce SNUD’s rights to exclusively operate Block 245 as a contractor on the basis of the 2003 P5C agreement between NNPC and SNUD and the financial implications of defending these actions from the public purse and opted for amicable resolution of the dispute.

“To resolve all the contending claims in a satisfactory and holistic manner, due regard was given to the Terms of Settlement of November 30, 2006 which had been reduced to Orders of the Court; the underlying policy of encouraging the participation of indigenous oil and gas companies in the upstream sector of the oil industry and the fact that Shell had substantially de-risked Block 245.
”To accommodate all these interests, a Resolution Agreement dated April 29, 2011 was executed wherein the Federal Government agreed to resolve all the issues amicably with Malabu in respect of Block 245 and Malabu also agreed that it would waive any and all claims to any interest in OPL 245.

“In furtherance of the Resolution Agreement, SNUD and ENI agreed to pay Malabu with the Federal Government acting as an intermediary, US$ 1,092,040,000 billion in full and final settlement of any and all claims, interests or rights relating to or in connection’with the oil block and Malabu agreed to 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.

The Committee concluded its public hearing yesterday.



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