Why Nigeria is insistent on Agip Oil paying back $110m

The Nigerian Government on Tuesday, November 6th, closed its prosecution in the $110 million court case instituted against Nigeria Agip Oil Company Limited.

Counsel to the Federal Government, Prof Fabian Ajogwu, had prayed the court to mandate Agip to pay the sum of $55 million with a twenty-one percent (21%) annual interest, and another $55m for damages.

The suit, which was filed by the Government in 2016, alleged that the oil company had short-changed it to the tune of $55 million when it continuously under-declared the volume crude oil that was shipped out of the country.

The alleged short-changing was said to have happened for four consecutive years between January 2011 and December 2014. Nigeria Agip Oil Company Limited will, today November 7th, begin its defence in the highly-contentious court case.

Nigeria has recently been taking tough actions on these oil companies 

Nigeria Agip is not the only company that the Federal Government of Nigeria has been tough on in recent times. The Government, recently, instituted similar suits against Chevron Nigeria Limited and Total E&P Nigeria Plc.

In the case of Total E&P Nigeria Plc, the Government fought to have the company return the sum of $245,258,640 which it said was “the total value of the missing revenues from the shortfall under-declared/undeclared crude oil shipments of the Federal Government of Nigeria.” The Government also sought the same amount as general damages.

Technology has played a huge role in uncovering the illegalities

According to the Federal Government, the use of high-tech information technology system such as satellite tracking systems played a part in helping to expose the crimes.

The recent lawsuits followed forensic analysis which linked the declining crude export and government revenue to the alleged under-declaration of crude by the oil companies.

Affidavits deposed by some US-based experts also show that Total E&P Nigeria Plc had illegally exported and sold some 57 million barrels of crude to some unnamed US buyers between January 2011 and December 2014. Again, the company did not remit any proceed from the transaction to the Federal Government.

From the foregoing, it can be seen that the Government is bent on having Agip Oil pay the $110 million as a way of deterring subsequent offenders.

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Author: see naija

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