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Two middlemen convicted of corruption over Shell and Eni Nigerian oil field deal

Nigerian Emeka Obi and Italian Gianluca Di Nardo sentenced to four years in prison as judge orders seizure of more than $120m: …this judgment will send shivers down the corporate spines of the oil industry — and will surely alarm Shell and Eni employees and shareholders who have been repeatedly told that there was nothing amiss with the OPL 245 deal.

Italian prosecutors allege that hundreds of millions of dollars from the 2011 sale of a field was distributed as bribes ( Reuters )

Two middlemen have each been sentenced to four years in prison for corruption offences in the first ruling of a huge bribery trial involving oil giants Shell and Eni. A judge also ordered the seizure of more than $120m from the pair.

Nigerian Emeka Obi and Italian Gianluca Di Nardo were convicted of international corruption by a Milan court for their role in a $1.1bn deal for rights to one of Nigeria’s most promising oil blocks.

Italian prosecutors allege that hundreds of millions of dollars from the 2011 sale of a field was distributed as bribes.

A judge ordered authorities to seize $98.4m from Mr Obi, and 21m Swiss francs from Mr Di Nardo.

The pair had elected to have a fast-track trial which took place behind closed doors and meant that their sentences would be reduced if they were convicted.

According to prosecutors, Mr Obi was in frequent contact with Eni executives trying to broker the sale and intended to pay out some of the money as kickbacks to politicians and Eni managers.

Now all eyes will turn to the main trial, with a hearing scheduled for 26 September. Both Shell and Eni deny any wrongdoing.

Thirteen individuals are also in the dock including Eni chief executive Claudio Descalzi and his predecessor, Paolo Scaroni as well as four former Shell employees, among them Malcolm Brinded, former executive director for Shell’s upstream operations.

For years Shell had claimed that it only transacted with the Nigerian government when buying the oil field, known as OPL245 which is thought to contain around nine billion barrels of crude. After years of investigations by NGOs, the London-listed company admitted that it had known former Nigerian oil minister and convicted money launderer Dan Etete had been behind the deal.

Mr Etete, who is a defendant in the case, awarded OPL245 to a company called Malabu in 1998, which it later turned out he controlled.

Antonio Tricarico of the Italian NGO Re:Common said Milan’s public prosecutors were right to “bravely” take on the two companies and several of their senior managers.

“The time has come that the Italian government, as main shareholder of Eni, considers suspending all those managers involved in the case until the final judgement,” he said.

Lanre Suraju, Chairman of Nigerian NGO Human and Environmental Development Agenda said the conviction “vindicates what international and Nigerian civil society has claimed for years: OPL 245 was a corrupt deal.”

Barnaby Pace, a campaigner at anti-corruption group Global Witness, hailed the convictions.

“As Shell and Eni’s trial looms, time will tell whether it’s just the middlemen who pay the price for this epic crime against the Nigerian people,” he said.

“But one thing’s for certain: this judgment will send shivers down the corporate spines of the oil industry — and will surely alarm Shell and Eni employees and shareholders who have been repeatedly told that there was nothing amiss with the OPL 245 deal.”

A spokesperson for Eni said the company acknowledged the judgment and maintains “full confidence” of the appropriateness and legality of its actions.

“This was a completely legal and legitimate transaction conducted directly with the government of Nigeria,” the spokesperson said.

SOURCE

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