Crude oil theft: Shell Petroleum trial to start in March

crude-oil

A Federal High Court sitting in Lagos will on March 20 begin trial in a suit filed by the Federal Government against Shell Petroleum Development Company (SPDC) and Shell Western Supply and Trading Ltd. over alleged crude oil theft.

The suit numbered FHC/L/CS/336/16 was filed by Federal Government’s counsel, Prof. Fabian Ajogwu (SAN).

Shell Petroleum Development Company of Nig. Ltd. and its subsidiary, Shell Western Supply and Trading Ltd., are defendants in the suit filed before Justice Mojisola Olatoregun.

Counsel to the plaintiff, Charles Nwabulu, on Wednesday sought to withdraw and replace an application he filed earlier on the matter.

The judge frowned at this and urged him to exhibit more seriousness in the case. She consequently awarded a cost of N100,000 against the plaintiff, and adjourned the case to March 20 for trial.

In the suit, the government is claiming $406.7 million from the oil company.

According to the government, the sum represents a shortfall of money paid by the company into the Federal Government account with the Central Bank of Nigeria.

The money was said to be for crude oil lifted by the oil company in 2013 and 2014.

In a supporting affidavit, the Federal Government accused the Anglo-Dutch company of not declaring or under-declaring crude oil shipments during the period.

It said that it discovered this following forensic analysis of bills of laden and other shipment documents.

The government stated in the affidavit that a consortium of experts tracked the global movements of the country’s hydro-carbons, including crude oil and gas. It said that Shell cheated Nigeria in revenue.

The Federal Government said in an affidavit that Shell engaged in practices that led to missing revenues from crude oil and gas exports to different parts of the world.

The government said that the experts noted discrepancies in the export records from Nigeria with the import records at U.S. ports.

It said that the undeclared shipments from January 2013, to December 2014, brought the total value of the entire shortfall to $406.75 million.

The defendants were said to have failed to respond to a Federal Government letter through its legal representative seeking clarification as to the discrepancies.

The Federal Government is therefore seeking a court order to compel Shell to pay $406.75 million, being the total missing revenue and interest payment at 21 per cent per annum.

Similarly, the court fixed March 30 for hearing in a similar suit between the Federal Government and Agip Oil Company Ltd.

The Federal Government had sued Chevron, Total and Agip over a similar case before the court.

It is asking for a total of $12.7 billion over alleged non-declaration of 57 million barrels of crude oil shipped to the U.S. between 2011 and 2014.

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

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