Former AGF, Adoke Denies Authorising Malabu Deal

The block, considered the richest in Africa, is estimated to contain over 9 billion barrels of crude and even larger volume of gas reserves.

Since the award of the contract to Malabu on April 20, 1998, by the Sani Abacha government, the rich oil block has been changed hands between oil giant Shell, and the Nigerian government over the next 12 years as all parties schemed for control.

Adoke in an interview with TheCable, said he only conveyed the approval of President Goodluck Jonathan to all the parties involved in the transaction.

‘’No, I did not authorise the transaction,” the former AGF said, “I only conveyed the approval of the President to all the parties. Those are two different things. I did not authorise the transaction as I was not a signatory but only conveyed the president’s approval.’’

Giving a full insight on the matter from the onset, Adoke said: ‘’The Malabu issue has been in existence since 1998. I want to take it from 1998 because I have seen that in recent times, the EFCC has taken up interest in the matter with a view to persecuting me.

“In order to make me look bad they have deliberately bifurcated the transaction and have chosen to present the issues from 2010 when I became involved in the settlement. However, the transaction started in 1998, when the military administration of General Sani Abacha came up with the policy of encouraging indigenous participation in the upstream sector of the oil and gas industry.

‘’They allocated oil blocks to indigenous companies on discretionary basis at a reduced signature bonus of $20 million. The beneficiaries include Malabu Oil and Gas Ltd, South Atlantic Petroleum Ltd (owned by Theophilus Danjuma) and Famfa Oil Ltd (Folorunsho Alakija). Malabu was allocated OPL 245 and they made a part-payment of $2 million for the signature bonus and brought in Shell as technical partners.

‘’Things seemed to be going on smoothly. Gen. Abacha died and Gen. Abdulsalami Abubakar came in, and things continued. And then he handed over power to Gen. Olusegun Obasanjo in 1999.

‘’Sometime in 2001, due to circumstances not very clear but which the principal actors in government at the time can best explain, the federal government revoked OPL 245 from Malabu, whose beneficial owner was Chief Dan Etete, among others. It will be recalled that Etete was minister of petroleum when the oil block was awarded to Malabu in 1998.

‘’The administration of President Obasanjo then invited some international oil companies (IOCs) to bid for the Block 245. Shell participated and won the bid. The signature bonus was now $210 million. Malabu felt short-changed that Shell, its technical partner, had acted irresponsibly.”

‘’Shell as technical partner to Malabu already had insider knowledge of the block. Malabu petitioned the House of Representatives who then conducted a public hearing into the transaction and concluded that the revocation of the block from Malabu and reallocation to Shell was done mala fide (in bad faith) and declared it null and void. It therefore passed a resolution that the block should be returned to Malabu.

‘’Government did not comply with the resolution, so Malabu went to court and there was a series of litigation between Malabu and the FGN until sometime in 2006 when they entered into an out-of-court settlement which was subsequently reduced to a consent judgment of the federal high court, Abuja under the tenure of the then attorney-general of the federation, Chief Bayo Ojo, SAN.

“As a result of the agreement and all the conditions set out to be met by all parties, Chief Edmund Daukoru, who was then the minister of state for petroleum resources, wrote on behalf of the FGN, and on behalf of the president and commander-in-chief of the armed forces, and who incidentally was the minister of petroleum, Chief Olusegun Obasanjo, GCFR, to convey the decision to return the block 100% to Malabu in accordance with the terms of settlement.”