American multinational investment bank and financial services holding company, JP Morgan Chase has been sued by the Nigerian government over its involvement in the 2011 Malabo oil deal.
JP Morgan Chase was sued in a London court for ‘gross negligence’ in the sale of the Oil Prospecting Licence (OPL) 245, an oil field reputed to be one of Africa’s biggest, worth about $1.3 billion.
The court documents sighted by Reuters revealed JP Morgan was accused of being “grossly negligent” in its decision to transfer funds paid by the energy majors into an escrow account to a company controlled by the country’s former oil minister, Dan Etete instead of the government coffers.
In view of this, the Nigerian government seeks damage of cash sent to Etete’s company, Malabu Oil and Gas, inclusive of interests. In total, the damages sought amount to over $1.7 billion.
However, the bank, in its reaction, noted that there was no form of fraudulent motive in the payments.
“J.P. Morgan is confident that it acted appropriately in making these payments, which were authorised by senior representatives of the Nigerian government, and only processed following extensive engagement with law enforcement and other agencies and courts. We will robustly defend against this claim,” a spokesman for the bank said.
Reuters reports that the Malabo oil deal dates back to 2011 when Royal Dutch Shell and Eni paid $1.3 billion to purchase an offshore oil field (OPL 245) from Malabu Oil and Gas, a company in which Etete held majority shares.
There are allegations that about $1.1 billion was siphoned off to politicians and middlemen under the contract.
OPL 245 is believed to be the largest oil field in Africa with over 9 billion barrels of crude oil. A report by the International Centre for Investigative Reporting (ICIR) revealed that the Economic and Financial Crimes Commission (EFCC) had, in December 2016, filed fraud and money laundering charges against Etete, as well as former Attorney General of the Federation, Mohammed Adoke and one Aliyu Abubakar who was said to have been used as a front by top government officials, including former President Goodluck Jonathan.
Adoke was accused of illegally transferring over $800 million purportedly meant for the purchase of the OPL 245 to Etete, Malabu Oil & Gas Limited from a Federal Government account.
The EFCC also accused Aliyu, who is the Chairman of A. A. Group and Rocky Top Services, of receiving $336,456,906.78.
