Landmark OPL 245 Dispute Resolution Hailed as Government Defends Decision
The Federal Government has strongly defended its recent resolution of the protracted OPL 245 oil block dispute, labelling it a significant achievement and pushing back against what it describes as misleading narratives from critics. The Attorney-General of the Federation (AGF) and Minister of Justice, Lateef Fagbemi, SAN, directly addressed comments attributed to the media office of former Vice-President Atiku Abubakar, asserting that these remarks misrepresented the outcome of the settlement process.
According to Fagbemi, the former Vice-President’s statements aimed to diminish the importance of what he termed a crucial breakthrough by the administration of President Bola Tinubu. This breakthrough, he argued, successfully resolved a dispute that has lingered for nearly three decades.
A Complex History of OPL 245
The OPL 245 oil block has a convoluted history marked by legal challenges and governmental shifts:
- 1998: The block was initially awarded to Malabu Oil & Gas Limited.
- 2001: The license was revoked.
- 2002: The block was subsequently reallocated to Shell Nigeria Ultra-Deep Limited.
This reallocation ignited a prolonged period of legal battles and intense legislative scrutiny, casting a shadow over the asset’s development and the nation’s oil sector.
The Path to Resolution: A Series of Agreements and Scrutiny
The AGF detailed the steps leading to the most recent settlement:
- 2011: The Federal Government entered into a resolution agreement. This agreement involved Malabu, various Shell entities, and affiliates of Eni, including Nigerian Agip Exploration.
- Terms of the 2011 Agreement: Under this deal, Malabu agreed to relinquish its claims in exchange for compensation. The OPL 245 block was then reassigned to Shell and its partners.
- Judicial Scrutiny: The AGF highlighted that the 2011 agreement and associated transactions were subjected to extensive judicial review in multiple international jurisdictions. These included the United States, the United Kingdom, and Italy. Crucially, these investigations yielded no findings of wrongdoing against the companies involved.
Emergence of New Challenges and Arbitration
Despite the earlier resolution and judicial clearance, new challenges arose, primarily due to delays by Nigeria in converting the oil prospecting license into an oil mining lease.
- 2020: Eni-linked entities initiated arbitration proceedings at the International Centre for Settlement of Investment Disputes (ICSID).
- Scope of Arbitration: Fagbemi clarified that this arbitration was narrowly focused on whether Nigeria had breached its treaty obligations under a bilateral investment agreement. He emphasized that it did not pertain to disputes over the ownership of Malabu itself.
Anticipated Economic Benefits of the Settlement
The current administration’s intervention, according to the AGF, is poised to unlock substantial economic advantages for Nigeria. These benefits are expected to include:
- Increased Government Revenue: Through royalties, taxes, and other fiscal contributions from the operational oil block.
- Enhanced Energy Security: By bringing a significant oil asset back into active production and contributing to national energy supply.
- Renewed Investor Confidence: Demonstrating the government’s ability to resolve complex disputes and create a stable investment environment.
Criticism and Government’s Response
The AGF addressed ongoing opposition to the settlement, referencing a recent decision by the Court of Appeal in the case of Nigerian Agip Exploration Limited vs. Malabu Oil & Gas Limited (2025). This ruling dismissed Malabu’s challenge to the allocation of the block, deeming it statute-barred and an abuse of court processes.
Fagbemi expressed significant concern over the continued opposition, alleging that critics are driven by “self-serving interests” rather than a genuine commitment to the national good. He urged the public to disregard what he characterized as attempts to undermine a lawful and strategic resolution. The Minister warned that such efforts could ultimately deprive the country of the full benefits derived from a critical national asset.
The statement concluded with a firm assertion: “The national interest must not be sacrificed on the altar of hidden agendas.” This underscores the government’s resolve to protect what it views as a crucial national asset and a strategic resolution for the country’s economic future.
