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$1.3 Million Malabu Oil Fraud: Eni, Shell To Face Corruption Trial

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Executives of Royal Dutch Shell and Italian energy company Eni SpA must stand trial on corruption charges in connection with a 2011 Malabu oil fraud in Nigeria, an Italian judge ruled Wednesday.

The prosecution marks a rare case in which top oil executives could face jail time for corruption allegations.

Prosecutors say in court documents that Eni CEO Claudio Descalzi and the other executives at both Shell and Eni knew most of the $1.3 billion the companies paid to the Nigerian government to acquire the drilling rights on opl 245 would be distributed as bribes.

Prosecutors say Goodluck Jonathan, the President of Nigeria at the time of the deal, received part of the kickbacks. The former President has continued to deny the allegation without giving any justifiable explanation for its role.

The trial is due to start March 5 and represents a significant development in one of the oil industry’s biggest corruption scandals.

The prosecution of the case is expected to open the widespread corruption in the Nigerian oil industry and the role of expatriates and multinational companies.

Executives indicted includes Paolo Scaroni, Eni’s CEO at the time of the deal, and Malcolm Brinded, Shell’s global exploration and production chief at the time of the deal.

Eni’s board of directors said it had “full confidence” that Mr. Descalzi wasn’t involved in the illegal conduct and “reaffirmed its confidence that the company wasn’t involved in alleged corrupt activities.” Eni said it reached these conclusions after several independent investigations into the matter.

“We aren’t happy that this is going to trial, but now there will be the judicial process and the company and Descalzi will have the opportunity to defend themselves,” Eni Chairwoman Emma Marcegaglia said in an interview.

Shell said it was “disappointed” by the indictment, but that it believes a trial will show there is no case against the company or its former employees. “There is no place for bribery or corruption in our company.”

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Akin Akingbala is an international journalist based in Lagos, Nigeria. Aside being happily married, he has interests in music, sports and loves traveling.

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