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REVEALED! How drowning Chinese-owned oil firm paid millions of dollars as bribe to Nigerian officials

As the Chinese-owned Addax Petroleum winds up its operations on December 10, a confidential document has emerged showing how the company paid millions of dollars in bribes to Nigerian officials to secure juicy contracts in the oil industry, Premium Times reports.

According to the report, there were payments for “questionable transactions” to Nigerian lawyers and a company owned by politician Emeka Offor, with a huge chunk of the money believed to be used to bribe government officials, Premium Times can report.

The document, a report by leading audit firm Deloitte obtained this week by Swiss newspaper, Le Temps, said payments in excess of $20 million were made to four Nigerian “legal advisors” (one of them based in the U.S.), while more than $80 million was paid to Mr. Offor’s Kaztec Engineering Limited for questionable projects.

“We have concerns over payments in excess of $80 million, which were made by Addax to Kaztec regarding construction projects for the Antan and Udele/Ofrima developments,” the audit firm stated in the document dated November 18, 2016.

“$70.8m was paid in 2015, including $48.7m for the Antan development, which was suspended in early 2015, and $15.8m for value engineering work on the Udele Ofrima development. This value engineering work has not taken place.”

The audit revelations on the misuse of Addax corporate funds came amidst moves by the company, a subsidiary of Sinopec International Petroleum Exploration and Petroleum Corporation, to wind up some of its operations across the world.

Last August, it announced a proposed closure of its corporate offices in Geneva, Aberdeen, and Houston as oil prices continued to shrink.

In 2001, the Olusegun Obasanjo government granted a fiscal incentive of graduated rate of royalty based on the volume of crude oil produced from OPL 98/118, now OML 123, 124, 136, and 137, as against the flat rate of 20 per cent obtainable in the industry. The fiscal regime was deemed to become effective on January 1, 2000.

Addax claimed it committed a “significant investment” in excess of $3 billion in the development of the contract areas.

However, in July 2011, the Federal Inland Revenue Service and the Department of Petroleum Resources raised an objection to the fiscal regime.

In 2014, Addax Petroleum dragged the Nigerian National Petroleum Corporation before a federal court in Abuja over allegations of miscalculation of oil royalties and taxes and a breach of their 1998 Production Sharing Contract regarding the OMLs.

Joined as respondents in the suit FHC/ABJ/CS/1099/2014 were the Ministry of Petroleum Resources/Department of Petroleum Resources and the Federal Inland Revenue Service.

But just four days before leaving office, the administration of former President Goodluck Jonathan negotiated a controversial out of court settlement with Addax Petroleum, agreeing to pay the company $3.4 billion (about N1 trillion).

In 2015, Premium Times reported how then Attorney General of the Federation, Mohammed Adoke, negotiated the shocking deal in what industry experts said was reminiscent of the infamous Malabu Oil deal in which the same Mr. Adoke was involved in.

Read More Premium Times

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