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Malabu Oil Saga, London court grants Nigeria leave to amend pleadings [Download Judgment]

Shell-and-Eni

This is an application made on 1 October 2021 by the claimant, the Federal Republic of Nigeria, to amend its pleadings. The court has in evidence the third witness statement of Mr Christopher Robinson, partner in Freshfields Bruckhaus Deringer LLP, on behalf of the defendant, JPM, dated 15 October 2021, and the ninth witness statement of Mr Jonathan Cary, partner of Reynolds Porter Chamberlain with conduct of this matter on behalf of the claimant, the FRN, dated 22 October 2021.

The application was originally heard on 19 November 2021 but unfortunately the time estimate proved to be inadequate and the matter had to be adjourned part-heard. The application has therefore been heard today, 14 January 2022. Both hearings took place remotely but the court had the benefit of both written and oral submissions from leading counsel on each side as well as the transcript of the first hearing.

It is a complicated matter and it is suffice to summarise the background as follows. It is a claim brought in contract and tort in relation to payments made by JPM out of the claimant’s account of approximately $801.5 million and $74 million to a Nigerian
company, Malabu, which the claimant says was in breach of JPM’s Quincecare duties of skill and care. The payments arose as a result of the purchase of an oil exploration licence, OPL 245, by companies in the ENI and Shell groups which in turn had resulted in funds being deposited with JPM. It is the FRN’s case that the payments to Malabu were in furtherance of a fraudulent and corrupt scheme of which the FRN was the victim.

As to the details of the frauds, the FRN say that in 1998 the then Minister for Petroleum Resources, Chief Etete, awarded licence OPL 245 to Malabu. FRN say that Malabu was a shell company beneficially owned and controlled by Chief Etete and the
son of General Abacha. The grant was subject to the payment of what is termed a signature bonus of some $20 million to the FRN within 30 days. In fact only a fraction of that amount was paid.

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