03 Mar

Daily Watch – Zenotech bids Nigeria goodbye, Malabu legal saga deepens

  • The EFCC has filed new corruption charges against Royal Dutch Shell, Eni SpA and others regarding the $1.3 billion purchase of a long-disputed oilfield in 2011, according to court documents released on Thursday. The charges of conspiracy to commit a felony and official corruption were made after an investigation by the financial crime watchdog found new evidence, Jonson Ojogbane, an EFCC senior prosecutor named in the documents, told Reuters. Shell and Eni did not immediately respond to requests for comment. The case is the latest of several inquiries, following those by Dutch and Italian authorities, into the 2011 purchase of Nigerian oil prospecting licence OPL 245 block, which could hold up to 9.23 billion barrels of oil, according to industry figures. A Nigerian court ordered in January the seizure of the oilfield assets and transfer of operations to the federal government on the request of the EFCC. On March 13, a court will rule on a request by Shell and Italy’s Eni to lift the temporary seizure. The targets of EFCC’s new charges include Shell’s local subsidiary, Eni and its local subsidiary, directors of those companies, a Nigerian former oil minister and a former justice minister. The court filing alleges those involved conspired to commit a felony and violated corruption laws by paying $801 million to Nigerian officials for OPL 245 in 2011. The oilfield’s licence was initially awarded in 1998 by former Nigerian oil minister Dan Etete to Malabu Oil and Gas, a company in which he held shares and which is also named in the new charges.
  • Nigeria raised ₦310.14 billion ($985 million) at an auction of treasury bills on Wednesday at yields lower than the inflation rate in Africa’s biggest economy, the CBN said on Thursday. The bank sold ₦222 billion of one-year treasury bills at a yield of 18.49 percent, lower than inflation at 18.72 percent and compared with 18.44 percent at a previous auction. A total of ₦62 billion of the six-month bill was sold at 17.20 percent, slightly higher than 17.15 percent at the previous sale. A total of ₦26.14 billion of three-month paper was sold at 13.65 percent against 13.69 percent previously. Subscriptions stood at ₦312.44 billion against ₦415.05 billion at the previous auction.
  • The CBN sold a total of $989.6 million to importers and retail customers in January with commercial banks allocating them at rates as low as ₦466.75, a record low by banks for sales to customers, data showed. This was prior to central bank’s decision in February to sell dollars to Nigerians wanting to pay for travel, foreign medical bills or school fees at around 20 percent above the official rate of ₦305. The shortage of dollars as a result of lower global prices for oil, its major export has weakened the naira on the black market, where it trades far lower than the official interbank rate. The January figures also showed that Nigeria’s Access Bank exchanged swapped a total of $150 million with two foreign lenders in January, CBN data showed. Nigeria’s fourth-biggest lender by assets exchanged $50 million with U.S. lender JP Morgan at ₦400 per U.S. dollar and another $100 million with South Africa’s ABSA at ₦329, data indicated. It showed a range of between ₦257.50 and ₦466.75 for dollar allocations in January. Last week the bank sold a total of $780 million in forward contracts to support the naira after effectively devaluing the naira for individuals, offering to sell them dollars at about half the premium the black market charges. The naira officially closed at ₦305.25 on Thursday after the regulator intervened to prop up the naira on the interbank market, traders said. However, the currency lost some grounds on the black market, quoted ₦458 per dollar.
  • The Nigerian Deposit Insurance Corporation said on Thursday that three million Nigerians had lost ₦18 billion in the Mavrodi Mundial Movement (MMM) Ponzi scheme which was fuelled in large part by social media. The Managing Director of the Corporation, Umaru Ibrahim disclosed this while speaking at the NDIC day at the ongoing 38th Kaduna International Trade Fair. Ibrahim emphasised that frequent usage of virtual currencies, such as Bitcoin, Ripples, Monero, Litecoin, Dogecoin and Onecoin as currencies used as a medium of exchange are Internet-based transactions and are not authorised by the CBN due to the risks involved in their operations.
  • The Board of Directors of Zenotech Laboratories approved a resolution authorising the management to take appropriate actions for initiating the process of winding up its Nigerian subsidiary. Founded in 1989 and headquartered in Hyderabad, Zenotech is an India-based pharmaceutical company engaged which manufactures and trades pharmaceutical products as well as biotechnology products. Its pharmaceutical product portfolio serves niche therapy areas, including oncology and anesthesiology. Zenotech Laboratories Nigeria Limited was established in August 2005 and along with subsidiaries in Brazil and the United States were the only foreign properties of the Indian pharma company.