Under-Declaration Of Crude Oil Lifted : Court Dismisses FG’s Suit Against Agip




By Gbenga Ogunbufunmi


The Federal High Court in Lagos today dismissed a suit filed by the Federal Government against the Nigeria Agip Oil Company Limited alleging under-declaration of crude oil.

The Federal Government has claimed the sum of $110 million from the respondent for allegedly under-declaring the volume of crude oil it shipped out of the country between January 2011 and December 2014, stating that the alleged act by Agip  has short-changed it to the tune of $55 million.

Federal government also prayed the court to compel Agip to pay the $55million with an annual interest of 21 per cent, as well as $55million as exemplary damages.

But, Agip in its defence denied the allegations and urged the court to dismiss the suit.

Delivering judgment in the suit today, Justice Cecilia Mojisola Olatoregun held that the Federal Government failed to provide sufficient evidence to substantiate the claims.

She held that there was no evidence that the crude oil the defendant lifted was more than what was declared.

According to her, it is trite and settled law that he who alleges must prove.

“The burden of proof starts with the plaintiff and keeps shifting until all the required evidence is placed before the court.

“Exhibit DA 10 shows that MT Cosmos was nominated to ship 949,096 barrels of crude oil and exhibit DC 10 from the Ministry of Petroleum Resources, shows the barrel of crude oil as 949,096 barrels from MT Cosmos.

“The plaintiff cited the same bill of lading number, but i have no reason to suggest that the bill of lading covers the excess 500,000 barrels of crude oil.

“While I do not have any evidence to suggest that it is impossible for the defendant to carry undeclared crude oil from Nigeria, I have no evidence to show that MT Cosmos carried the excess 500,000 barrels of crude oil with same bill of lading,” she held.

The court held that the plaintiff failed to prove its case by supplying the requisite evidence, adding that the main purpose of final addresses is to assist the court.

“It is trite law that whoever asserts, must prove that the facts exists; no amount of brilliant address can make up for a lack of evidence.

“The plaintiff failed to make out a case that 500,000 barrels of crude oil was offloaded in Pennsylvania; the case of the plaintiff fails on the lack of proof on the preponderance of evidence.

“At this stage, I do not find it necessary to proceed with the evaluation of the other reliefs.

“I, therefore, proceed to make an order dismissing this suit; it is hereby dismissed,” the court held.

During trial, the plaintiff only called one witness and tendered three exhibits, while the defendant also called one witness and tendered 12 exhibits.

Meanwhile, the court also dismissed a similar suit against Brasoil, seeking to recover the sum of $4.8million in missing oil revenue.

Similar lawsuits against Total E&P Nigeria Plc and Chevron Nigeria Limited are pending before the court.

The Federal Government sued after a forensic analysis linking the decline in crude oil export and government revenue to the alleged under-declaration of the volume of crude oil shipped out of the country by the oil companies.

Three United States-based experts -a US citizen and Lead Analyst at Loumos Group LLC, a technology and oil and gas auditing firm based in the US Professor David Olowokere; a counsel in the law firm of Henchy & Hackenberg, Jerome Stanley, and founder and Chief Executive Officer,Trade Data Services Company, State of Arizona, US, Michael Kanko deposed to supporting affidavits to the suit.

According to them, about millions of barrels of crude oil were allegedly illegally exported by the defendants and sold to buyers in the US without due remittance.

They alleged the companies did not make due remittance to the Federal Government contrary to the terms of agreement.

But the defendants denied the allegations.




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