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Thursday, October 6, 2016

FG accuses Shell of crude oil theft, demands $406.75m refund



Prof. Fabian Ajogwu, the counsel to the Federal Government, had accused the Anglo-Dutch company of not declaring or under-declaring crude oil shipments during the period, following forensic analysis of bills of laden and shipping documents. The Federal Government is demanding $406.75 million from Shell Petroleum Development Company of Nigeria Limited and its subsidiary, Shell Western Supply and Trading Limited, over alleged crude oil theft. 

The amount, according to court documents presented in Lagos on Tuesday, represents the shortfall of the money the multinational oil firm paid into the Federal Government’s account with the Central Bank of Nigeria. The money was said to be for crude oil lifted in 2013 and 2014. Prof. Fabian Ajogwu, the counsel to the Federal Government, had accused the Anglo-Dutch company of not declaring or under-declaring crude oil shipments during the period, following forensic analysis of bills of laden and shipping documents.

Ajogwu, armed with sworn affidavits of three US-based professionals, claimed that Shell cheated Nigeria of the revenue. The professionals included Prof. David Olowokere, a US citizen and lead Analyst at Loumos Group LLC, a technology and oil and gas auditing firm.

The others are Jerome Stanley, a Counsel at Henchy &Hackenberg law firm and head of the legal team engaged by Loumo Group LLC, and Michael Kanko, founder and current Chief Executive Officer of Trade Data services Company.

According to the documents, the consortium of experts tracked the global movements of the country’s hydro-carbons, including crude oil and gas. They identified the companies engaged in the practices that led to missing revenues from crude oil and gas export sales to different parts of the world.

They also revealed discrepancies in the export records from Nigeria with the import records at US ports. The Federal Government is, therefore, seeking a court order to compel the two companies to pay $406.75 million, being the total value of the missing revenue and interest payment at 21 per cent per annum.

In addition, the government is also asking Shell to pay general exemplary damages in the sum of $406.75 million and the cost of instituting the legal action.

They are among 15 oil majors targeted by the government for the recovery of $17 billion in deprived revenue.

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