His Majesty the Sultan of Brunei meeting Malcolm (TFA) Brinded, Shells Executive Director, Upstream International.
By John Donovan
On Sunday 1 January, the Borneo Bulletin published a gushing article under the headline “Oil & Gas continues to shower Brunei with benefits, opportunities“.
It described a claimed lovefest relationship between Royal Dutch Shell and the Brunei Royal family, which the Sultan of Brunei has summed up as: “the extraordinary symbiotic partnership between the Sultanate and the global oil giant… Royal Dutch Shell…“
The so called symbiotic relationship is between a scandal-tainted Brunei royal family and a scandal-tainted oil giant, which attracted international attention when it gave a $500,000 gift for a lavish Brunei royal wedding in September 2004. Many would view such a large sum as a bribe.
The relationship between Shell and the Sultanate has not been as deliriously happy as the article suggests. It was for some time mired in acrimony regarding the controversial subject of Brunei hydrocarbon reserves, which featured prominently in a massive securities fraud surrounding Shell, that came to light early in 2004. The huge wedding gift may have been designed to placate the regime.
Confirmation of the lengthy acrimonious debate between Shell and the Brunei regime on the reserves issue and related accusations made by the regime against Shell, can be found on page 43 of a sworn 965 page video taped deposition by Royal Dutch Shell Group Reserves Auditor, Anton Barendregt.
The Brunei reserves manipulations, designed to defraud Shell shareholders, also featured prominently in an independent report prepared by Davis Polk & Wardell for the Shell Group Audit Committee, and in reports issued by (1) the U.S. Securities & Exchange Commission which fined Shell $120 million for securities fraud and (2) the UK Financial Services Authority, which found Shell guilty of “Market Abuse” and issued a fine of £17 million pounds.
The news of the scandal made global headlines and resulted in the forced resignations of Royal Dutch Shell Group Chairman Sir Philip Watts, and his executive director colleagues, Walter van de Vijver and Judith Boyton. Shell also settled several major class action lawsuits.
In February 2010, news broke of a “series of massive fraud investigations against more than 10 senior oil company officials” of Brunei Shell Petroleum (BSP). Some officials had already been dismissed and others suspended as a result of the fraud probe by the Brunei Anti Corruption Bureau.
Strange how none of these sordid events were mentioned in the love fest article published on 1 January 2012.
MORE ARTICLES ABOUT THE $5 MILLION BRUNEI ROYAL WEDDING
The $5m royal wedding: sponsored by local companies, including the oil and gas firms Brunei Shell : The Independent 10 September 2004
Shell Rewards Employees (*Bribes and scandal in Brunei?): Brudirect.com
Will the Prince Turn Pauper? (*$500,000 Shell bribe was given to this corrupt family): Wall Street Journal article published March 2008
Brunei Shell contributes $500,000 for royal wedding ceremonies: Brunei-online.com: August 2004