More evidence has emerged to show that global oil giants, Shell and ENI, were very much aware that they were paying over a billion dollars to an ex-con in a shady deal over a Nigerian oil bloc.

Despite insisting that they had no previous knowledge that a huge chunk of the $1.1billion (N155 billion) they paid to the Nigerian government for oil block OPL-245 will be transferred to Malabu Oil, owned by convicted felon Dan Etete, proceedings from a recent U.K. High Court case shows that Shell, and Italian energy giant, ENI, were aware of the final destination of the money.

PREMIUM TIMES had previously reported how the two multi-nationals paid the huge sum to the Nigerian Government. The Jonathan administration, in shady circumstances, transferred the money into accounts controlled by Mr. Etete.

The transfers have become subject of probes and investigations by the National Assembly and the Economic and Financial Crimes Commission, EFCC.

Over 50 per cent of the payment was further transferred by Mr. Etete into accounts controlled by Abubakar Aliyu, a man described by Nigerian anti-graft officials as ‘Mr. Corruption’; and who has continued to shun both the National Assembly and the EFCC investigators. Mr. Aliyu, a close ally of Attorney General, Mohammed Adoke, is also an associate to Diepreye Alamieyeisegha, former governor of Bayelsa State and close associate of President Goodluck Jonathan.

Shell wined and dined with criminal

Testimony presented in a High Court case brought by a Nigerian consultant, Energy Venture Partners, which claimed that it was owed money for helping to arrange the payment of the N155 billion to Malabu Oil, shows that in 2009 an official of Shell had a jovial face-to-face meeting with Mr. Etete, while they had lavish “lunch and lots of iced champagne,” few months before the money was paid to the Nigerian government that subsequently transferred it into Malabu’s account.

An email presented during the trial also mentioned that the Shell official who feted with Mr Etete would refer to someone in The Hague known as “Peter” over the terms of the deal. Curiously, Shell’s CEO is named Peter Voser.

Mr. Voser has not responded to questions sent by our partner, Global Witness, a U.K. based international organisation committed to transparency and accountability in the global extractive industry, on whether he is the “Peter” mentioned in the email.

The email further shows that Mr. Etete had asked Shell to provide some initial figures of how much it was willing to pay for the oil block and the official responded that “Peter has to talk to The Hague and we will come back with a figure.”

Shell did not directly answer questions by Global Witness to explain whether the “Peter” cited in the email was its CEO Peter Voser.

“We can confirm that neither [Shell’s Nigerian subsidiary] SNEPCo nor any other Shell company is party to those proceedings and, as a consequence, we cannot comment on any statements or allegations made in the course of those proceedings,” said Shell to the allegations made during the court proceedings.

Global Witness explained that a Shell 2010 annual report shows no other “Peter” in the company’s top management staff. This is an indication that Shell’s most senior executive is aware that the company negotiated with a convicted criminal.

Eni meets Etete

Similarly, documents presented during the High Court case also show that ENI officials including its Chief Operating Officer, Claudio Descalzi, had several meetings with Mr. Etete in Lagos as well as at the luxury Acanto Restaurant in the Principe di Savoia Hotel, Milan, in February 2010.

Other meetings between Mr. Etete and ENI officials were held in April and November 2010, the document alleges.

When contacted by Global Witness, ENI avoided questions about its meetings with Mr. Etete. It however said: “the transaction concerning the acquisition of the 245 Block has been conducted by Eni and Shell in full compliance with the laws.”

It said Eni acquired the OPL-245 Block “directly from the Government of Nigeria.”

“We believe that the Government of a sovereign country should not be mistrusted and that dealing with the Government directly and without the use of intermediaries ensures full transparency in that transaction,” Eni added.

Phony claims

Global Witness has rubbished Shell and Eni’s claims describing them as insufficient.

“Shell and Eni’s claim that they did not do a deal with Malabu fails to address the question of their knowledge of where the payment was ultimately going. They also fail to explain their apparent extensive direct dealings with Etete,” said Global Witness Director, Simon Taylor.

“Both companies appeared to enjoy rather lavish meals with Etete, and ended up taking part in an arrangement that, in the absence of a better explanation, looks like an attempt to conceal their US$1.1 billion deal with Abacha’s money laundering convicted oil minister.”

Details from the court proceedings also show that Shell ceased direct negotiation with Mr. Etete when it found out that Mohammed Abacha, the son of Sani Abacha, Nigeria’s late military dictator, was claiming to own a percentage of Malabu oil.

However, it commenced negotiations with the Nigerian government and in April 2011 paid $1.1 billion to the Jonathan’s administration for onward transfer to Malabu’s account in an intricate fraudulent scheme.

Mr. Etete was the Petroleum Minister under Sani Abacha. PREMIUM TIMES previous investigations had detailed how he fraudulently awarded the oil block to himself and friends, including Mohammed Abacha, in contravention of Nigerian laws.

In 2007, Mr Etete was found guilty of money laundering in France. The conviction was upheld by a higher court in 2009 after he had challenged the earlier conviction; but his sentence was commuted from a three years prison sentence to a fine of over N16.4 billion.

Lobbying against transparency legislation

Meanwhile, Shell has continued relentlessly to lobby against legislations in the EU intended to bring transparency into the payment between governments and oil companies. The proposed EU Transparency Directive requires a project-by-project reporting of payment between governments and oil companies.

As a member of the American Petroleum Institute (API), it is also in the forefront of a U.S. lawsuit aimed at striking out Provision 1504 of the Dodd-frank Act that was signed into law by President Barack Obama last July. The law requires payment disclosure by U.S.-listed extractive companies.

“This scandal demonstrates precisely why we need the new transparency laws being finalized in Europe that require companies to disclose their payments right down to the project level – with no exemption for any country,” said Mr Taylor.

“In light of Shell’s behaviour in Nigeria, it is difficult not to conclude that it wishes to keep its deals in the dark.”

Mr Taylor, therefore, called on “all EU countries, including Italy, should support exemption-free transparency laws that would bring these kinds of payments into the open.”