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Humans · Economy

Bribery scheme uncovered in Nigeria's oil industry

April 28th, 2017
in:Humans, Economy
by:Kolawole Talabi
located in:Nigeria
tags:BudgIT, corruption, EFCC, ICPC, Niger-Delta, Nigeria, Shell

Nigeria is renowned for its large oil and gas reserves but also for widespread institutional corruption that siphons petroleum revenues into the pockets of politicians and bureaucrats as exemplified by the current scandal involving former president Goodluck Jonathan and a number of global energy giants including Shell and Eni.

Although agencies such as the EFCC (better known as the Economic and Financial Crimes Commission) exist to curb the graft in Nigeria, the apparent lack of independence hampers their efforts. But it seems all hope is not lost as several citizen-led initiatives have sprung up to make fiscal probity a rule rather than the exception in Africa’s largest economy.

One of such initiatives is BudgIT and its founder, Oluseun Onigbinde talks to fairplanet about the challenges and the opportunities of fighting corruption in Nigeria.

Shell has played a major role in the development of Nigeria’s energy sector but still the corporation has also been implicated in the pollution of the Niger Delta as well as many cases of bribery. Is it time for Shell to be shown the way out or how can Nigeria salvage this dicey relationship?

Oluseun Onigbinde: I don’t think the solution is that Shell be shown the way [out]. These incidents of gas flaring or oil spills happen around the world but there are regulatory agencies whose mandate is to ensure that there are enough sanctions for such behaviour. A major issue in Nigeria is that we have weak institutions, mainly extensions for patronage for international corporations. This is why Nigeria can’t stand up for what is right. We don’t put the health and livelihood of our people first rather, we are more interested in quick money from oil. It is so unfortunate and telling Shell to exit the Nigerian space won’t resolve this.

Despite the vast prosecutorial powers of national anti-corruption institutions such as the EFCC and ICPC, why has Nigeria made very little or no progress in the investigations of oil block scandals such as the OPL 245 involving former President Jonathan? (Italian legal authorities are beginning hearings on the matter on April 20.)

Most of the work has been done by Global Witness and to their credit, this issue has stayed on the front burner. OPL 245 is a consequence of how through the stroke of a pen, we create billionaires in Nigeria for what they don’t need to break a sweat or have any expertise in. It goes beyond this oil block and it reveals how we award oil acreages in Nigeria. Dan Etete was the Minister of Petroleum and he invariably awarded an oil block to himself. Such can still happen today and it depends on setting rules in this sector. The government has the right to review this case most especially allegations of money laundering. I am afraid our agencies might not have the capacity to fully tackle this.

Six countries including Nigeria have opened investigations into this case. Given that the bribery scandal involves both corporate bodies and individuals, should these countries collaborate or not?

Vice President [Yemi Osinbajo] recently spoke of the need for an international collaboration to really tackle graft and cross-border illicit financial flows. It is important that the world works together to break the chain. Most of these funds are actually meant for schools, hospitals and public spaces but they directly end up in private pockets. We need an international collaboration [system] that the world is ready to fully commit to.

The current anti-corruption crusade of the Buhari administration has failed to secure high-profile convictions in the last two years. If this OPL scandal ever got to a Nigerian court, is there any possibility that justice will be served?

I think the lack of failure to get high-profile convictions cuts across different segments of the judiciary. I don’t think this case can be properly resolved here. We have not done a thorough reform of the judiciary and that means our system can hardly bring justice. Cases are being prolonged, our criminal code is too lenient and a lot of technicalities stand in the way of justice. We have to resolve this to proceed for a just society.

What is the best approach for ensuring accountability and transparency in the Nigerian oil industry to prevent similar bribery schemes in the future? What reforms have worked in other countries and how may we adapt them to fit our peculiarity?

We need to imbibe transparency in the award of oil contracts, acreages and revenues. We have generated huge sums of money from oil but where is the money? We need strong institutions, remove discretion in the award of oil licenses and ensure radical transparency at all fronts. There is nothing peculiar about Nigeria’s case, we just have an elite not incentivised to do what is right.

Since 1999 no former president has been successfully charged with abuse of power. If former president Jonathan is taken to court on this case, could it be a gamechanger? Would it matter in the long run in the fight of corruption or just another footnote in the history of justice in Nigeria?

The fact that previous heads of state are members of the Council of State makes it nearly impossible to prosecute a former president. This is why impunity reigns and because no one has been properly prosecuted, this issue [of impunity] has continued. If Jonathan has a case to answer on abuse of public resources and trust, let him face it. However, we know this is Nigeria. Things are not as they seem. The next thing you hear is disruption of pipelines and shutting down of national oil production heavily tied to our economy. We are in a fix to do these things. This is why we possibly need a weaker federal government as well as institutionalize accountability at all levels of government. Our ethnic issues are so complex that we will be better with a weaker centre.

Explain in your own words why your work in human rights/anti-corruption matters? What more do you think you can to in this regard?

At BudgIT, we work to ensure that citizens have adequate understanding of public finances and use such information to ask questions and demand accountability. Our mission is to ensure that every [Nigerian] citizen irrespective of their literacy span and level of interest in governance understands public data and uses such information to spark informed debate and create civic action needed for institutional reform. We are willing to help institutions and engage citizens to intersect their interests for a better Nigeria.

Article written by:
Kolawole Talabi
Author
Current Map: Our coverage
A major issue in Nigeria is that we have weak institutions, mainly extensions for patronage for international corporations. This is why Nigeria can’t stand up for what is right.
We need to imbibe transparency in the award of oil contracts, acreages and revenues.
We have generated huge sums of money from oil but where is the money? We need strong institutions, remove discretion in the award of oil licenses and ensure radical transparency at all fronts

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