Petrochemical giant Shell is in court over criminal charges in the Netherlands over a Nigerian oil licence at the heart of a $1.3bn (£1bn) corruption scandal.
The Dutch Public Prosecutor’s Office (DPP) is preparing charges related to Shell’s 2011 purchase of the valuable offshore oil field known as OPL 245.
“As appropriate, we will provide updates as this matter progresses,” Shell said on Friday.
Shell and two of its former senior executives, Peter Robinson and Malcolm Brinded, are in the midst of a separate criminal trial in Italy over the purchase.
Italian prosecutors allege that Shell and Italian oil giant Eni, which was also part of the deal, knew $1.1bn of the fee was going to a company controlled by convicted money launderer and former Nigerian oil minister Dan Etete.
Hundreds of millions of dollars were then distributed to a number of middlemen and well-connected officials, with some of the money being used to buy a private jet, armoured Cadillacs, fine art and luxury shotguns, prosecutors allege.
Eni’s chief executive Claudio Descalzi and his predecessor Paolo Scaroni are among those charged in the case. Both companies and all of the individuals charged deny the allegations.
New charges in the Netherlands will open up another front on Shell’s multiple legal battles. The Anglo-Dutch firm also faces a billion-dollar claim from the Nigerian government over alleged fraud and corruption stemming from OPL 245. Nigeria claims hundreds of millions of dollars were diverted from the public purse for “bribes and kickbacks”. Swiss, US and French authorities have also investigated the case. Separately, Shell faces legal action from thousands of residents of the Niger delta who say their livelihoods have been ruined by decades of oil spills from the company’s pipelines.
The amount allegedly distributed as bribes is more than the entire 2018 healthcare budget of Nigeria, a country where vast oil wealth lives side by side with 87 million people in extreme poverty.
In total, Nigeria will be deprived of $6bn under the deal because of the terms agreed for future oil revenues from OPL 245, research by Global Witness found.
Shell has said it does not believe there is a case to answer.
After years of denials, Shell admitted in 2017 that it knew Mr Etete was behind the OPL 245 deal.
In the final days of the regime of Sani Abacha in 1998, Mr Etete awarded the oil field – which held around a quarter of Nigeria’s known reserves – to a company called Malabu Oil and Gas, which it later emerged he controlled.
When rights to the field were finally sold in 2011, the payments went through the Nigerian government but were then paid into Malabu’s accounts, much of it via banks in London. Shell says it paid money to the Nigerian state and therefore acted properly.
Emails revealed that a former MI6 agent hired by Shell, who is also a defendant in the case, had been in contact with Mr Etete from at least 2009, two years before the deal was sealed. The agent wrote of champagne lunches with Etete in Paris at which the deal was discussed.
In one internal email to a senior Shell executive, he wrote: “Etete can smell the money. If, at nearly 70 years old, he does turn his nose up at $1.2bn he is completely certifiable and should then probably just hold out until nature takes his course with him.”
Further correspondence from June 2010 states that Etete claimed to have a letter from Goodluck Jonathan (GLJ), then Nigerian president, that was “clearly an attempt to deliver significant revenues to GLJ as part of any transaction”.
Hundreds of millions of pounds of that money passed through JPMorgan in London, which is being sued by the Federal Government of Nigeria for “gross negligence”.
In court filings, JP Morgan said the UK’s top anti-money laundering authority gave the green light for the payments after the bank raised a series of suspicious activity reports.