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Tag: shell

  • Shell, Eni face $1.1b lawsuit over Nigeria deal

    The Federal Government is suing Royal Dutch Shell Plc, Eni SpA and other companies for more than $1 billion over a 2011 oil deal it said was tainted by corruption.

    The suit, filed in London, alleges that money the companies paid to acquire an oil exploration license in the Gulf of Guinea was diverted to bribes and kickbacks, the government said in a press release. The transaction is already the subject of a separate, ongoing criminal trial in Milan.

    Nigeria’s government claims that Shell and Eni are partly responsible for the behaviour of “corrupt Nigerian officials” who used a $1.1 billion payment to acquire the oil block for personal enrichment. The suit seeks to recoup that money, which it says belongs to the Nigerian people.

    The Federal Government is already a civil party in the case in Milan, and can seek damages from that court. Additionally, it sued JPMorgan Chase & Co. in London last year, accusing it of failing to prevent the illicit transfer of funds related to the transaction. The bank said the claim was without merit.

    Shell and Eni have previously denied any wrongdoing in the criminal case over the block, called OPL 245, that is under way in Italy. They said they made the payment into a legitimate government account to settle legal claims related to the block.

    A spokesperson for Shell reiterated that the company’s payments in Nigeria over OPL 245 were legitimate and said that since the matter is being tried in Milan “it would not be appropriate for us to comment in detail on the new claims.” A spokesperson for Eni said it confirmed “the correctness and compliance of every aspect of the transaction in respect of OPL 245” and rejected “any allegation of impropriety or irregularity.”

    The Federal Government also included Nigeria-based Malabu Oil & Gas in the lawsuit, and a company called Energy Venture Partners Ltd. Malabu was allegedly controlled by Nigeria’s former Petroleum Minister Dan Etete, who took possession of the $1.1 billion payment and used it for bribes and kickbacks, according to the lawsuit.

     

    A lawyer for Etete, Antonio Secci, said the London suit “surprises” because the Federal Government is already seeking damages in Milan. “This situation cannot be represented again in London because it is repetitive,” he said.

    The case is Nigeria v. Royal Dutch Shell, High Court of Justice, Commercial Court, Case No. CL-2018-000787.

  • Shell is Local Content Operator of the year

    The Shell Petroleum Development Company of Nigeria Limited (SPDC) has emerged the Local Content Operator of the Year at the Annual Oil Industry Achievement Awards organised by the Petroleum Technology Association of Nigeria (PETAN).

    PETAN is  an association of indigenous technical oilfield service firms in the upstream and downstream sectors.

    This is the third time that Shell Companies in Nigeria have won the  award, having clinched it in 2013 and 2015.

    Shell’s General Manager, Contracting and Procurement, Antony Ellis, also bagged the PETAN Chairman Outstanding Achievement Recognition Award for promoting Nigerian oil service firms. Both awards were given after an evaluation of the contributions of the international and national oil firms, to local content development.

    “The awards are in recognition of Shell’s sustained effort in shaping direction of local content implementation in Nigeria through support for local asset ownership, growth of indigenous companies and human capacity development at all levels,”  PETAN Chairman, Mazi Bank-Anthony Okoroafor, said at the awards  dinner held in Port Harcourt.

    Nigeria Content Development and Monitoring Board Executive Secretary Simbi Wabote presented the  award to SPDC’s General Manager External Relations, Igo Weli, who represented the oil giant’s Managing Director, Osagie Okunbor.

    In his response, Weli said: “We are motivated by these gestures to continue to pursue in-country value addition in the oil and gas sector in alignment with the government’s aspiration in local capacity development.”

    The awards are the latest in the recognition of Shell’s pioneering role in content development. In 2016, PETAN honoured SPDC with the Distinguished Achievement Award (Corporate); Shell Nigeria Exploration and Production Company (SNEPCo) Managing Director Bayo Ojulari received PETAN’s Professional Award in the same year for his contributions to the development of local content in the oil and gas sector.

  • Shell trains Abia fire-fighters

    Shell Nigeria Gas (SNG) has retrained 30 fire-fighters in  Abia State and donated fire-fighting equipment to the state fire service. This intervention was triggered by two recent fire disasters in the state, which resulted in deaths and loss of property worth millions of naira.

    Over 150 shops in the timber and furniture section of the Nkwo Ngwa Market in Aba was gutted by fire mid-November, barely five weeks after an explosion on a pipeline belonging to the Nigeria National Petroleum Corporation (NNPC) in Umuaduru and Umuimo communities of the state killed a number of people.

    The SNG intervention, according the company’s Managing Director, Ed Ubong, was to demonstrate the company’s continued care for the people and support to Nigerians particularly those in the company’s areas of operations.

    “Some of these disasters are either avoidable or preventable. The major gaps are in training and equipment, hence our quick response to retrain the firefighters and provide them with modern equipment to support their operations,” Ubong said, adding that SNG would strengthen its gas distribution network in the Abia State to help in its rapid industrialisation.

    The equipment donated included tunics and personal protective equipment (PPE). The state’s Commissioner for Transport, Charles Chinedum Elechi, received the items with a commitment that the state would improve on its safety record in a manner that would promote industrialisation and development.

    Speaking at the donation, the state’s Fire Service Comptroller, Victor Gbaruko, described the training of his personnel, particularly in hydrocarbon fire-fighting, as an investment worthy of emulation by other big players in the state’s economy.

    The 20-year-old SNG is owned by Shell and is the first gas distribution company run by any oil major in Nigeria. SNG’s extensive gas distribution network in Abia, Ogun and Rivers states has boosted manufacturing output and helped these states to grow their internally generated revenues while providing local employment opportunities.

    In 2017, the SNG executed a Memorandum of Understanding (MoU)with the Rivers State government for the distribution of gas to industries in the Greater Port Harcourt area and its environs. The agreement provided further opportunities for the SNG to promote gas as more reliable, cleaner and cost-effective alternative to liquid fuels in Nigeria.

  • Nigeria risks losing $6b to bad oil deal, experts warn

    •Eni, Shell deny wrongdoing

    Nigeria will lose an estimated $6billion following the controversial 2011 deep water block Oil Prospecting Licence (OPL) 245 deal with Shell and Italian energy giant Eni, industry experts warned yesterday.

    An analysis presented in Lagos by Resources for Development Consulting found that in the contract, commonly referred to as the Malabu deal, Nigeria is cheated of billions of dollars in revenue from two out of three regular sources.

    The firm noted that the deal excluded Shell and Eni from paying royalty and Profit Oil on the OPL 245 which were part of the fiscal terms contained in earlier contractual agreements with the oil companies in 2003 and 2005.

    The investigation was commissioned by non-governmental organisations (NGOs) Global Witness, Human and Environmental Development Agency (HEDA), RE: Common and The Corner House.

    They urged the Federal Government to revoke the deal.

    OPL 245 has about nine billion barrels of crude oil, estimated to be worth half a trillion dollars.

    According to Resources for Development Consulting President, Dr Don Hubert, the fiscal terms governing the OPL 245 deal favoured only Shell and Eni.

    Using a discounted cash flow analysis model made up of elements, including fiscal terms, field data from various sources, an oil price assumption of $70 a barrel, the firm projected that Nigeria lost at least $4.5 billion based on 2003 fiscal terms on the deal.

    It said the Federal Government lost $5.86 billion over the lifetime of the project, based on 2005 fiscal terms.

    Hubert said: “The payment of $1.1 billion dollars in 2011 was not only a payment to secure rights to OPL 245, the payment also served fiscal terms that were highly generous to the IOCs (International Oil Companies)but were highly detrimental to the government of Nigeria.

    “The lack of profit oil in the current fiscal terms that is governing OPL 245 will result, our analysis shows, in a loss to the Nigerian people of at least $4.5 billion.”

    Barnaby Pace from Global Witness said: “Today’s report shows how the terms of agreement was in their favour… Globally, there is call on the Nigerian government to revoke the licence so that its estimated $6 billion losses will be stopped in its track. We also call for contracts to be made public.”

    Olanrewaju Suraj, chairman at HEDA, said: “The crux of the concern elicited by the controversial deal derives from the process of awarding the licence to ENI and Shell.

    “The multinationals included clauses depriving the Nigerian state of its rightful share of oil production and, by implication, incur monumental losses in revenues that ought to accrue to the coffers of the country.

    “It is estimated that with oil prices in the region of $70 per barrel, potential revenues that were negotiated away could amount to $5.86 billion.

    “There is therefore a need for Nigerian government to diligently pursue ongoing litigation, including taking necessary steps to enhance the prosecution of the cases arising from the OPL 245 scam and to cancel this scandalous deal.”

    Reacting to the analysis by Global Witness, Eni and Shell denied any wrongdoing.

    Erika Mandraffino, Eni’s senior vice president, Global Media Relations and Crisis Communication, queried the methodology of the analysis.

    “We note that Global Witness draws conclusions on the appropriateness of Eni’s and its partner’s transaction and on the legitimacy of Eni’s conduct by referring to analyses carried out by unnamed partners whose competence or expertise is not substantiated in your letter,” Mandraffino wrote.

    “We can understand that your organisation, which is not engaged in business activities in the oil and gas sector, may not be best placed to assess the input, methodology and overall quality of such analyses and come to incorrect conclusions. In this respect, let us just note that the technical and contractual assumptions adopted as basis for the analysis appear to be partial and inaccurate, if not misleading.”

    The sale of the block, which is considered as one of the most lucrative in Africa, has been replete with allegations and lawsuits.

    Several former Shell executives and current and former Eni executives as well as the two companies, are on trial in Milan, Italy over the purchase of rights to the block.

    Two middlemen in the deal, a Nigerian, Emeka Obi and an Italian, Gianluca Di Nardo, were convicted of corruption in September and a judge ordered the seizure of more than £93.6m from the pair.

    On April 14, the Federal High Court in Abuja held that immediate-past Minister of Justice and Attorney-General of the Federation (AGF), Mr. Mohammed Adoke (SAN), could not be held liable for his roles in transactions concerning the deal.

    The Economic and Financial Crimes Commission (EFCC) had charged Adoke with various offences involving his alleged roles in the transactions in which Nigeria was said to have been defrauded of about $1.8bn.

    Delivering the judgment in the suit filed by Adoke against the incumbent AGF, Mr. Abubakar Malami (SAN), Justice Binta Nyako held that since Adoke only executed the lawful directives/approvals of the then President Goodluck Jonathan, the former minister was free of any liability for his roles in the deal.

  • ‘Trans-Ramos spill: Shell frustrating post-spill evaluation’

    FORTY-three Trans-Ramos communities in Burutu Local Government of Delta State have accused Shell Petroleum Development Company (SPDC) of frustrating post-spill damage assessment following the May 17 oil leakage from SPDC’s facility.

    Community leaders addressed a news conference in Warri,yesterday, alleging that the tier-3 spill ravaged their communities due to late response from the company.

    The conference issued a statement signed by Chief Godspower Numa and Eric Kudokudo, chairman and secretary of Trans-Ramos Pipeline Oil Spill Impacted Communities Forum,

    It said: “First, SPDC deliberately delayed in responding to this spillage banking on the tidal nature of the River Ramos to deplete the spill before she responded. Second, at the time of response, SPDC only dealt with Aghoro community in Ekeremor Local Government Area of Bayelsa State to the exclusion of all other communities within the River Ramos.

    “SPDC unwillingly accepted Amazor and Agge communities only when she discovered there were spill points in Amazor and Agge communities. Only Aghoro II and I communities received relief materials to the exclusion of all the communities polluted by this massive spillage,” it added.

    They flayed the government’s nonchalance to the exclusion of their communities.

    “However, the Warri Zonal office of NOSDRA took up the exclusion of the Delta communities with SPDC but SPDC remained adamant. The Warri Zonal office escalated the issue to NOSDRA Headquarters Abuja. NOSDRA Abuja summoned a meeting of SPDC and the Forum on September 11, 2018. It was in this meeting that the SPDC agreed to allow for a post-spill Impact Assessment and Damage Assessment of the Trans-Ramos pipeline oil spillage of May 17, 2018.”

    “It is about three months after the agreement to a Post Spill Impact Assessment and Damage Assessment. This 3 months delay is due to SPDC’s antics to stop or albeit frustrate the Post Oil Spill Impact Assessment and Damage Assessment because SPDC is wont to use all the tricks in her exhausted bags of tricks to evade liability.

    “SPDC has used discriminatory supply of relief materials to communities, contracts to their cronies within our communities and the promise of future cleanup and remediation contracts to divide and destabilize our communities so that as we fight for these contracts, there will be enough excuse by SPDC to stop the Assessment already agreed on.”

    SPDC, however, debunked the report, telling NOSDRA that it provided relief materials to the impacted communities, as a show of goodwill.

  • Shell appeals court’s order on MD, two others

    Shell Petroleum Development Company (SPDC) has appealed a Rivers State High Court order sentencing its managing director and two others to three months’ imprisonment for contempt of court.

    News Agency of Nigeria (NAN) reports that a Port Harcourt High Court on Tuesday sentenced the Managing Director, Mr. Osagie Okunbor and two others to prison with hard labour.

    Reacting to the sentence, the Manager, Corporate Communications and External Relations, Mr. Bamidele Odugbesan, yesterday in an SMS to NAN in Lagos decried the pronouncement.

    He said: “We do not accept that SPDC has disobeyed any court order and we have accordingly appealed this judgment. SPDC has utmost respect for the courts and the laws of Nigeria.

    “We have appealed the order and applied to suspend its execution, pending the outcome of the appeal.”

    Odugbesan said the 2008 judgement was settled between SPDC and the landlord families in 2014.

    “An amicable resolution and settlement agreement was signed by the parties in 2014, after which SPDC paid the rents due on the land up to 2019,” he said.

    Odugbesan cited a public notice by the landlord families in the October 24, 2014 edition of The Guardian, acknowledging the settlement with SPDC.

    He said the Bonny Oil Terminal is a critical national asset in which the Federal Government has 55 per cent interest.

    “For this reason, SPDC has taken lawful steps to protect its officials and ensure uninterrupted operations at the terminal, in the interest of the nation.

    “It receives crude from international and local oil companies through the Trans Niger Pipeline and the Nembe Creek Trunk Line for Export,’’ Odugbesan said.

    Members of Bonny community in Rivers had approached the court, presided over by Justice George Omeriji, to commit the SPDC officials to prison for disobeying its order of 2008.

    The community wanted the court to direct the company to forfeit the land where one of Nigeria’s biggest oil terminals, Bonny Oil Terminal, was located.

  • NNPC, Shell’s Cradle-to-Career scholarship beneficiaries hit 375

    Another 108 Nigerians have been awarded secondary education scholarship under the NNPC/SNEPCo National Cradle-to-Career (NC2C) Scholarship scheme, launched in 2014. This is bringing the beneficiaries in the last four years to 375.

    The scholarship, administered by Shell Nigeria Exploration and Production Company (SNEPCo), offers full boarding and tuition-free support to the beneficiaries throughout their education in top-rated private secondary schools across Nigeria.

    “This is part of our wider social investment programmes to support Nigerian youths, particularly the less-privileged, to attain the height of their potential notwithstanding their socio-economic background,” said the Managing Director of SNEPCo, Bayo Ojulari, at the award ceremony at Grundtvig International Secondary School in Onitsha, Anambra State.

    Ojulari, who was represented by the company’s Bonga Asset Operations Manager, Elohor Aiboni, said SNEPCo, with the support of the NNPC and its co-venture partners was committed to providing opportunities for Nigerian youths not just in education, but in entrepreneurial training and empowerment as demonstrated by SNEPCo’s other social investment programmes across the country.

     

     

  • Wike, Shell, NPA to meet over SNEPCO’s relocation to Lagos

    Rivers State Governor, Nyesom Wike, is to meet with the top management of Shell Petroleum, the Nigerian Ports Authority (NPA), Oil and Gas Free Zones Authority (OGFZA) and other relevant stakeholders over the planned relocation of the Supply Base of Shell Nigeria Exploration and Production Company (SNEPCO) from the Oil and Gas Free Zone, Onne to Lagos.

    The meeting is coming on the heels of an aborted protest by the Rivers State Youth Federation.

    Youths and women group in Rivers State have staged peaceful protests to express their displeasure over the planned relocation of the SNEPCO Supply Base from Onne, saying it will have adverse economic and security implications on the state and the entire Niger Delta region.

    On Wednesday, the Directorate of State Security (DSS) in Rivers State and a former Niger Delta warlord and the Amanyanabo of Okochiri Kingdom in Okirika Local Government Area of Rivers State, King Ateke Tom, intervened in the matter and stopped a massive protest planned by the Rivers State Youth Federation led by its President, Comrade Saviour Patrick.

    Ateke Tom and the Rivers State DSS Director, held a meeting with Comrade Patrick and representatives of SNEPCO, where it was agreed that the youths would shelve their planned protest, while SNEPCO would suspend the planned relocation until after the meeting with Wike.

    The Nation gathered that both the DSS and the Rivers State Government are concerned about the long term security implication for the state should the relocation to Lagos be executed.

    A source said the youths are upset although the DSS Director told them there was not much they could do, but he is worried that the situation does not degenerate into renewed militant activities in the state.

    The source added that this would not be the first time Shell had attempted to relocate its business from Rivers State. He hinted that Shell’s decision was likely more political than commercial.

    In August, more than 1,000 youths under the aegis of the Onne Youths Council (OYC) staged a peaceful protest at the SNEPCO Supply Base, asking the company to rescind its decision to relocate the base from the Onne Oil and Gas Free Zone to Lagos port.

    The President of OYC, Comrade Philip John Tenwa, who led the peaceful protest, said the planned relocation would lead to the loss of more than 5,000 direct and indirect jobs.

    The protesters carried placards with various inscriptions condemning the planned relocation of the SNEPCO Supply Base and also requested relevant authorities to intervene in the matter.

    He said protests are intended to draw attention of the Nigerian government and indeed the world to the plan by Shell Nigeria Exploration and Production Company (SNEPCO) to relocate its Supply Base from the Onne Port to Lagos. Indeed, SNEPCO last week surreptitiously directed that all its property and equipment including turbines, engine spares and miscellaneous equipment spares be loaded into containers and moved out of the Onne Port, where it had operated for more than 20 years, to another port in Lagos.

    Tenwa said: “This move by SNEPCO has serious and far-reaching implications for the Onne community and indeed the entire Rivers State. This is because SNEPCO, which is the operator of the Bonga field, at present, supports more than 5,000 direct and indirect jobs at its Supply Base in Onne. There are also several small businesses and contractors whose businesses and fortunes are tied to SNEPCO.”

    SNEPCO workers, in a press release described the planned relocation as hurried and ill-advised and against the interest of the Niger Delta region.

    The press release signed by one Edward Otaru reads: “We, the affected operations staff and expatriates of SNEPCO wish to bring the attention of the Federal Government and well-meaning Nigerians of a plan by the management of our company to forcefully relocate our operations from Onne, Port Harcourt to Lagos.

    “The hushed, hurried but forceful relocation order emanated under a strange and suspicious condition, as it was neither discussed with the staff nor backed by any justifiable reasons.

    “We decided to bring this hurried relocation order to the notice of the government and the general public because of its implication on our families and friends who might suffer unnecessary dislocation and also its implication on the Niger Delta region.

    “The ill-advised plan to move men and materials from the Niger Delta region to Lagos is also contrary to the directive of the Federal Government, which in 2017 asked oil companies to retain their headquarters in their operational bases in the Niger Delta region.”

    The workers called on the Federal Government to halt the planned movement in the interest of jobs and development of the Niger Delta region.

    The Paramount Ruler of Onne Community, King John Dennis Osaronu, also recently called on SNEPCO to rescind its planned relocation from the community.

  • Shell seeks review of oil contracting circle

    The Managing Director, Shell Petroleum Development Company (SPDC), Mr. Osagie Okunbor, has sought a solution to the contracting circle in the industry.

    According to him, in an interview with KPMG magazine, there is a need to review and shorten the length of the contract threshold.

    The review, he said, is of importance to the Joint Ventures and the contracting circles.

    His words: “The contracting cycle is the third major enabler that needs to be addressed. OPTS4 has looked at contracting cycles across jurisdictions and Nigeria is an outlier because of our lengthy contract cycle. We need to explore avenues to shorten the length and examine contract thresholds, which is a significant part of the JVs and contracting cycles.”

    Okunbor, who is also the Country Chair of Shell, noted that there is need to consolidate security situation in Nigeria, especially in the Niger Delta.

    While emphasizing the need to partner the Federal Government to ensure the security of oil and gas assets and for production, he recalled that a reoccurrence of violence in the region in 2016 severely impacted oil production negatively.

    Okunbor said oil is a major component of the global and local energy mix that will continue to remain relevant in the medium term. He, however, stressed that the expectations have changed.

    According to the SPDC boss, “Oil will remain a relevant component of global energy mix, and even more so for Nigeria, over the next 10 to 15 years, if not more.”

    Continuing, Okunbor insisted that “the mix will not radically change. What is clear is that society expects low-carbon footprints going into the future. I think that is key and everyone, particularly those who are as big as Shell, understands that and will work with society to change.

    “We are cutting our carbon footprint by a significant proportion going forward, not just in terms of what we directly produce, but also our usage and our by-products. This requires that we continue to refine our systems and processes to ensure that the carbon intensity of our production continues to go down.”

    Okunbor added that the SPDC will significantly leverage technology and digitisation to further enhance its business systems, processes and operations in Nigeria.

    He said: “We are a part of a global business, and in our sector, what differentiates us is how we commercialise technology and grow top and bottom line with technology. We pioneered deep-water exploration and production in Nigeria. We continue to push boundaries and Shell in Nigeria takes maximum advantage of the technological and digital capabilities of the Shell Group.”

  • Shell recovers oil from spills, shuts pipeline

    Royal Dutch Shell subsidiary, Shell Petroleum Development Company of Nigeria Ltd (SPDC), yesterday said it has recovered more than 95 per cent of the oil from two spills that took place this year, although the pipeline that carries crude to the coast for export remains closed.

    The Trans Ramos pipeline, which carries some Forcados crude oil to the export terminal of the same name, closed in late April following two leaks, one in Abhoro in Bayelsa State and one in Odimodi, in Delta State.

    A spokesman for Shell said there had been no change in the operating status of the pipeline.

    “As soon as clean-up and site assessment are completed, we are committed to starting the immediate remediation of the impacted areas in Aghoro and Odimodi,” SPDC said in a statement.

    The Forcados grade, along with Bonny Light and Qua Iboe, is one of Nigeria’s three largest crude streams.

    Meanwhile, the Chairman, Seplat Petroleum Development Company Plc, Ambrose Orjiako, said market exists for gas produced in the country, adding that the remained committed to producing the product for the country

    Orjiako who spoke during a breif ceremony to mark the 60th birthday of the Chief Executive Officer of the firm, Mr. Austine Avuru in Lagos,  said part of the reasons why there is growth in gas treatment is because there is increasing demand with good pricing for the product.

    The theme of the forum was: 60 Years Later: Preparing for a Nigeria without Oil.

    He said the environment remains very conducive for gas supply to the industry as well as to the agriculture sector.

    “Seplat as an organisation does not always project, but at all times we say that the future is bright for the company. Given the very strong foundation and fundamental conditions of Seplat, we can only look ahead and know that the future is very bright for the company,” he said.