The Federal Government appears to have made progress in the prosecution of the flaws associated with the controversial award of OPL 245 to oil giants, Shell and Eni.

On Wednesday, a consultant hired by Italian prosecutors, Dr Dayo Ayoade, said in Italy that the contract award of OPL 245 to Shell and ENI, did not follow Nigerian legal provisions. He spoke in Milan, where he made lead presentations to prosecutors.

Ayoade, of the Department of Law, University of Lagos, was hired by Milan prosecutors to ascertain whether the two oil giants met corporate and legal obligations. The celebrated case is being contested by high-profile legal experts from Nigeria and across the world, including a retired Nigerian Supreme Court Judge, Justice Emmanuel Ayoola JSC (Rtd), who stood in for Shell; a Queens Counsel (QC), Prof. Frank Odita, representing ENI, with Mrs. Felicia Femi Olusegun.

The Milan Deputy Chief Prosecutor, Mr. Fabio DePasquale, had taken Ayoade through his expert report when he was asked to prepare a submission in support of corruption charges, bribery and illegal sale and acquisition of the oil blocks by the two major oil companies and the allocation of the blocks to Malabu by the former Minister of Petroleum Resources, Chief Dan Etete.

Ayoade told the court: “The award process for OPL245 to Shell and ENI did not follow the procedure established in the Petroleum Act, Petroleum (Drilling and Production) Regulation and DPR Guidance Notes for Prospective Bidders.

"Failure to follow the relevant laws, policies and regulations is fatal to the legality of the OPL 245 award (Zebra Energy Ltd V FGN (2002)). It is my considered view that the licence award on the basis of a FGN Resolution Agreement is anomalous and unprecedented in the Nigerian Oil and Gas Sector.”

Under examination by the prosecutor, Ayoade further expressed shock at the condition for the acquisition of the lucrative block by the IOCs. In his oral testimony, he said: “I am surprised that everything around the Resolution Agreements destabilises established petroleum laws and regulations in Nigeria."

The Milan prosecutor had contracted Ayoade to prepare a submission in support of the charges of corruption, bribery and illegal sale and acquisition of the oil block by the two major oil companies and the original allocation of the block to Malabu by Dan Etete while serving as a Minister of Petroleum Resources as unconstitutional. 

A court in Milan had convicted the two facilitators of the deal, Emeka Obi and Gialuca DiNardo, through accelerated hearing in September 2018. The main presentation of experts’ report, examination and cross-examination of the experts resumed on Wednesday after an agreed break for preparation and translation of reports into Italian by all the parties.

"Contrary to the laws and standards, the Office of Attorney General of the Federation supervised the resolution processes and agreements on OPL245 deal as against the Ministry of Petroleum Resources," Ayoade said.

"The Minister of Petroleum Resources does have sufficient powers to award oil licences, but this must follow established procedure; and the Minister must perform his statutory duties in the public interest.”

The public interest is obviously missing in the OPL 245 award and subsequent Resolution Agreements. According to the expert, this was observed and stressed in the letter from DPR to the Minister of Justice on the Resolution Agreements allegedly prepared by the Oil companies.

While the experts of the Nigerian Government were expected to make written and oral presentations on April 4, the presentation by the ENI experts are expected next week, April 10.

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