After several years of inquiry into the purchase of an offshore oilfield in Nigeria by Shell and Eni, an Italian judge on Thursday sentenced two defendants to jail in the first ruling on one of the oil industry’s biggest graft scandals.
The two oil majors are embroiled in a long-running corruption case revolving around the purchase in 2011 of one of Africa’s biggest oilfields – Oil Prospecting Licence 245 – for about $1.3bn.
Nigerian Emeka Obi and Italian Gianluca Di Nardo were found guilty of international corruption and each given four-year jail sentences, Reuters quoted three sources with knowledge of Thursday’s ruling as saying.
Lawyers for Obi and Di Nardo declined to comment, according to Reuters.
Milan prosecutors alleged that bribes totalling around $1.1bn were paid to win the licence to explore the oilfield which, because of disputes, has never entered into production.
The main trial, which besides Eni and Shell, also involves Eni Chief Executive Officer, Claudio Descalzi, and four ex-Shell managers, including a former Shell Foundation Chairman, Malcolm Brinded, is expected to drag on for months.
But Obi and Di Nardo, accused of being middlemen and taking illegal kickbacks, had asked for a separate fast-track trial which, under Italian law, allows sentences to be cut by a third.
Thursday’s ruling will not tie the court’s hand in the main trial.
The next hearing of the main trial involving Eni, Shell and 13 people is set for September 26.
Barnaby Pace, anti-corruption campaigner at Global Witness, was quoted as saying, “This judgment will send shivers down the corporate spines of the oil industry.”
In an emailed statement, a spokeswoman for Shell was quoted as saying that neither Obi nor Di Nardo worked on behalf of the company, adding that it was waiting to see the fast-track judge’s written decision.
“Based on our review of the Prosecutor of Milan’s file and all of the information and facts available to us, we do not believe that there is a basis to convict Shell or any of its former employees of alleged offences,” it said.
Also in emailed comments, Italian oil company Eni reiterated it had acted correctly in the purchase of OPL 245, saying it had worked directly with the Nigerian government.
OPL 245 is one of the biggest sources of untapped oil reserves on the African continent with reserves estimated at nine billion barrels.
Eni, the biggest foreign oil producer in Africa, has been doing business in Nigeria since 1962 and last year produced 109,000 barrels of oil equivalent per day.
Shell is the biggest foreign investor in the country, producing 266,000 barrels of oil equivalent per day in 2017.
The sources said the Milan judge had ordered the seizure of $98.4m from Obi and more than 21 million Swiss francs ($21.9m) from Di Nardo.
Prosecutors had alleged that Obi received a mandate from a former Nigerian Petroleum Minister, Dan Etete, to find a buyer for OPL 245, collecting $114m. Di Nardo, they said, took $24m of that amount for putting Obi in touch with Eni.
