A Review of the Nigerian Energy Industry

Malabu Oil Block: House recommends restoration of ownership to Abacha, others

House-of-Reps-session19 February 2014, Abuja – The House of Representatives ad hoc committee  that looked into the controversy surrounding the  Malabu Oil and Gas deal has recommended that the son of late Head of State, Muhammad Abacha and his partners, Kweku Amafegha and Pecos Energy Limited, be allowed to repossess Oil Prospecting Licence (OPL 245).

The licence, which was said to have been won by Shell Nigeria Exploration and Production Company Limited (SNEPCO) and AGIP, has been a subject of controversy for sometime now.

Although the report was adopted, this was not without opposition from some members.  Last week, the consideration of the report was postponed, following a point of order against it by Hon. Robinson Uwak (PDP, Akwa Ibom).

But the Committee of the Whole at the plenary presided over by the deputy speaker, Hon. Emeka Ihedioha, yesterday re-visited the matter and adopted the report.

According to the House: “the federal government should cancel OPL 245 recently granted to SNEPCO (50 per  cent) and AGIP (50 per cent), as it was based on a highly flawed ‘Resolution agreement” entered between Malabu Oil and Gas, Shell Nigeria Exploration and Production Company (SNEPCO) and Nigeria Agip Exploration (NAE) with the federal government acting as obligator.”

It premised its resolution on the fact that the Agreement, which gave the oil block to Shell and others “ceded away our national interest and further committed Nigeria to some unacceptable indemnities and liabilities while acting as obligator.”

Other recommendations adopted are  “that the Federal Government through the Ministry of Petroleum Resources and the Office of the Attorney General of the Federation facilitates a new Resolution Agreement in line with the Petroleum Act and Indigenous Concession Programme of Government that guided the initial allocation of OPL245 to Malabu Oil and Gas.

“That AGIP Nigeria Agip Exploration Limited (NAE) be formally censured or reprimanded by the House for its role in the Resolution Agreement, which lacked transparency and did not meet international best business practices.

“That Shell Nigeria Ultra Deeps (SNUD) be censured or reprimanded by the House for its lack of transparency and full disclosure in its bid to acquire OPL 245; that Nigeria Police should take over the ongoing investigation on the matter of forgery and alteration of documents indicating some directors of Malabu Oil and Gas Limited, who resigned their positions or transferred their appointments or shares without authorisation, and initiate prosecution of any person indicted.

“That in line with global best practices of  accountability and transparency, individuals and financial institutions linked with and found culpable by the Economic and Financial Crimes Commission (EFCC) of receiving and transferring money unlawfully with respect to or arising out of the Resolution Agreement, should be charged to an appropriate court of competent jurisdiction, and where such monies were unlawfully transferred should be recovered.”

But Simon Arabor (PDP, Kaduna), kicked against the adoption, saying it usurped the jurisdiction of the courts in recommending that the contract be cancelled.

Citing section 4 of 1999 Constitution which delineates the powers of the legislature and  section 6(6), which vested the powers of the adjudication in the courts, Arabor argued that the ad hoc committee by its recommendations was playing the role of advocate for Malabu Oil.
“The report is going to embarrass this House. We cannot sit here and interpret the agreement. We should discountenance this report,” he added.

However, Uzor Azubuike (PDP, Abia), said notwithstanding the argument of Arabor, section 88 and 89 of the constitution empowers the House to look into any matter, so the point of order was out of place.

Consequently, Ihedioha ruled that in line with the House rules, the recommendations would be taken one after the other and any member not in support should vote against it.


– This Day

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