Tuesday, September 20, 2016

Undeclared oil shipment: FG sues Agip, Total for $635m

The Federal Government is demanding $635
million from two multinational oil companies,
Agip and Total, for undeclared crude oil
shipped out of the country between 2011 and
Two cases have been filed at the Federal
High court in Lagos by senior lawyer and
Senior advocate of Nigeria, Professor Fabian
Ajogwu, who had handled several cases for
the Federal Government on aviation, defence,
energy, and financial services.
Hearing will begin next week before Justice
Olatoregun Isola.
And there are indications that Ajogwu will
also be filing claims against other
multinationals, such as Chevron and Exxon-
The Nigerian Government in the two cases is
claiming $490,517,280 from TOTAL E&P
NIGERIA LIMITED and $145,848,102 from
The statements of claim filed before the court
are accompanied by the sworn affidavits of
three US based professionals.
The Nigerian Government contends that
sometime in 2014,it realised a decline in its
oil export revenue. This necessitated an
intelligent gathering of data, which showed
that part of the reasons for the decline was
the under-declaration of crude oil shipments
made by some major oil and gas companies
operating in Nigeria.
Professor David Olowokere, a US citizen who
is the lead Analyst at Loumos Group LLC, a
technology and oil and gas auditing firm
based in United States of America, Jerome
Stanley, a counsel in the law firm of Henchy
& Hackenberg, a law firm based in United
States of America and head of the legal team
engaged by Loumo Group LLC, made the
court statements.
The third deponent is Michael Kanko a citizen
and resident of the State of Arizona United
States of America, who is the founder and the
current Chief Executive Officer of Trade Data
Services Company.
A forensic analysis of export records from
Nigeria and the import records from
respective ports of entry at the United States
of America used by Agip and Total showed
The volume of crude Oil declared to have
been exported from Nigeria, was less than
what was declared to have been imported
into United States of America via the same
shipment by the same vessel on the same
bill of lading.
Some other shipments were not declared by
the defendants to the requisite authorities,
particularly the pre-shipment inspection
agents. In some instances, the crude oil
shipments were completely undeclared.
The plaintiff (Nigerian Government ) alleged
further that all crude oil and gas shipments /
exports from Nigeria are required to be
declared and inspected by pre -shipment
Agents appointed by the Central Bank of
Nigeria of revenue due from the crude oil
The inspection records are to be deposited
with ministry of finance Nigeria .
The Nigerian Government averred that high-
technology information technology system
including satellite tracking systems were
deployed by consultants in gathering the
various validated information establishing the
shortfalls in the export declarations and the
import declaration in the country of
Court documents showed that 57 million
barrels of Nigeria crude oil was illegally
other companies and sold to buyers in the
United States of America between January
2011 and December 2014. The revenue due
to Nigeria as a result of this under-
declaration and non-declaration is
$12,722,600,327($12.7billionDollars) which
translates to N2,493,629,664,092(2.5Trillion
Naira) at an official rate of 197 Naira to one
US Dollar
In one of the instances cited, TOTAL E&P
NIGERIA LIMITED shipped crude oil using a
vessel by name TRIATHLON to Tostsa Total
oil Trading SA of San Felipe Plaza-Suite
2100,5847 SAN FELIPE, 770557-HOUSTON
United States at the port of Philadelphia,
Pennsylvania, United States of America with
a bill of lading number TCVMTRIATIA 1388.
The shipment was not declared to the
relevant authorities resulting in the shortfall
of 968,784 barrels of crude oil in the value of
$106,566240 as revenue to the Government,
Another under-declared crude oil was
estimated at 491,850 barrels with a value of
$54,103,500. It was shipped aboard a vessel
named NORTH STAR and sold to BP
Products North America of 501 Westlake
Park Boulvard, Houston, TX 77079 United
States, at port of Texas City, with bill of lading
On two different occasions 768,990 barrels
of crude oil, valued at $84,588,910 was
loaded on a vessel named AUTHENTIC. It
was Shipped to Socap international limited of
Cannon’s court, 22 Victoria Street, Hamilton,
HM12.Bermuda at the port of Chester
Pennsylvanian, United States bill of lading
ALMYSVDM17041101 and17041102
The Nigerian government seeks an order of
the court compelling Total E&P Nigeria
Limited to pay into the FEDERAL
GOVERNMENT OF NIGERIA account with the
Central Bank of Nigeria, $245,258,640 being
the total value of the missing revenues from
the shortfall /under-declared/undeclared
crude oil shipments of the Federal
Government of Nigeria.
Government also wants the oil firm pay
General damages of $245,258,640 and
Interest on the said sum at the rate of 21
percent per annum until the entire sum is
The case has been adjourned till next week
for hearing .
In a separate suit, the Federal Government of
Nigeria alleges that NIGERIA AGIP OIL
COMPANY LIMITED on 16 June 2014 lifted
crude oil on board the vessel named VALUE.
The firm shipped the cargo to Philadelphia
Energy Solutions of 1735 Market street
Philadelphia, PA USA at the port of
Wilmington, Delaware, United States of
America with Bill of lading number
Government claims that the shipment was
not declared to relevant authorities resulting
in the shortfall of 175,334 barrels of crude oil
in the value of $38,573,561as revenue to
Federal Government of Nigeria.
On 27 June,2011,Nigerian Agip Oil Company
limited lifted crude oil on board a vessel
named COSMIC and shipped same to ENI
TRADING & SHIPPING B.V. of Strawinskylaan
1641-Tower C/16 1077C XX. Again,
government claims that the shipment was not
declared to the relevant authorities resulting
in a shortfall of 467,614 barrels of crude oil in
the value of $107,274,990 as revenue to the
Federal Government
Despite letters written by the legal
representative of the Federal Government for
payment of the shortfall, the company had
failed to make any payments to the Federal
The Federal Government of Nigeria now
claims against Nigeria Agip Oil company
*An order compelling the company to pay
into Federal Government of Nigeria ‘so
account with central bank of Nigeria the total
sum of $145,848,551being the total value of
the missing revenues from the shortfall/
under declared/undeclared crude oil of the
Federal Government
*Interest at the rate of 21 per cent per annum
until the entire sum is liquidated.
*General damages in the sum of
$145,848,551.and the cost of this legal
There are imminent claims against other Oil
exploration companies including Chevron.

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