Shell, Eni Found Not Guilty of Corruption in Nigeria Oil Case -- Update
March 17 2021 - 3:46PM
Dow Jones News
By Sarah McFarlane and Eric Sylvers
An Italian court acquitted oil companies Royal Dutch Shell PLC
and Eni SpA, along with the latter's chief executive, of bribery in
connection with oil-drilling rights in Nigeria, ending a three-year
trial that had shone a spotlight on the energy industry's
operations in Africa.
Shell, Eni and individuals including current Eni CEO and company
veteran Claudio Descalzi were on trial over a $1.3 billion payment
made for drilling rights in Nigeria that prosecutors argued was
mostly for the purpose of bribes. Eni and Shell jointly bought
drilling rights off the coast of Nigeria in 2011 in an area known
as OPL 245.
The verdict, which concludes a rare instance of top executives
from Western oil companies facing prosecution for corruption, comes
at a time of increased scrutiny of foreign bribery. U.S. and
European authorities have enacted a growing body of laws aimed at
stamping out corruption around the world.
Last year Eni agreed to pay $24.5 million to resolve alleged
violations of the U.S. Foreign Corrupt Practices Act, in relation
to contracts it won with an Algerian state-owned oil company. Eni
neither admitted nor denied wrongdoing in the settlement.
The Italian court case concerned a payment Eni and Shell made to
a Nigerian government bank account in London. According to court
documents, the money later landed at a Nigerian shell company owned
by a former oil minister, who was later convicted in France of
money laundering. From there, the money was paid out in kickbacks
that funded a variety of purchases by Nigerian nationals, including
a private jet in the U.S., according to the court documents.
Eni, Shell and their managers maintained they didn't know the
money would be paid out in bribes.
All other defendants were also acquitted, including Paolo
Scaroni, Eni's chief executive at the time of the deal, Roberto
Casula, Eni's former head of exploration at the time, and Malcolm
Brinded, Shell's former chief of global exploration and
production.
The Italian prosecutors, who were seeking eight-year jail
sentences for Messrs. Descalzi and Scaroni, can decide whether or
not to appeal the acquittals when the three judges who ruled in the
trial publish their reasoning in the coming weeks.
"Descalzi gets his professional reputation back today," said
Paola Severino, a lawyer for Mr. Descalzi, who was reappointed last
year for a third term at the helm of Eni.
Global Witness, a London nonprofit that investigates allegations
of wrongdoing in the resources industry, said it would urge the
Milan prosecutor's office to consider an appeal. The verdict can be
appealed twice in Italy's court system.
"We await the details of how the judges reached this ruling, but
believe this verdict shows just how hard it is to hold the fossil
fuel industry to account," said Barnaby Pace, senior campaigner at
Global Witness.
The trial was closely followed in Italy, where Eni is considered
to be one of the country's corporate jewels. The government owns
about a third of Eni.
"We were obviously confident in the innocence of our client, but
this was such a high-profile case and the pressure from all over
was so strong that you can never be sure," said Giuseppe Fornari,
the lawyer for Mr. Casula. "Sometimes in a trial like this you can
lose on a tiny detail."
Eni and Shell welcomed the ruling.
"After almost three years of trial, the judgment by the court
has finally established that the company, the CEO Claudio Descalzi
and the management involved in the proceedings have all behaved in
a lawful and correct manner," Eni said in a statement.
"We work hard every day to ensure our actions not only follow
the letter and spirit of the law, but also live up to society's
wider expectations of us," Shell CEO Ben van Beurden said after the
verdict.
Write to Sarah McFarlane at sarah.mcfarlane@wsj.com and Eric
Sylvers at eric.sylvers@wsj.com
(END) Dow Jones Newswires
March 17, 2021 15:31 ET (19:31 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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