EXCLUSIVE: Why UK Fraud Office isn’t

prosecuting billionaire Indimi’s oil firm

named in criminal conviction
November 28, 2018Oladeinde Olawoyin

Nigeria’s billionaire oil magnate, Muhammadu Indimi. [PHOTO CREDIT: Medium]

An investigation by PREMIUM TIMES has established reasons why the United Kingdom’s
Serious Fraud Office (SFO) did not prosecute oil and gas firm, Oriental Energy, after it was
named in a UK criminal conviction.
Oriental Energy is an indigenous firm owned by Nigeria’s billionaire oil magnate,
Muhammadu Indimi.

PREMIUM TIMES reported how the oil firm was named in a money laundering and
fraud case involving Osman Shahenshah and Shahid Ullah, two former top executives of
energy firm, Afren.

The duo were in October convicted after they were found guilty of money laundering offences
in the United Kingdom.

Prosecutors said Messrs Shahenshah and Ullah illegally received more than $17 million in a
case involving Oriental Energy and they committed the offences whilst serving as Chief
Executive Officer (CEO) and Chief Operating Officer (COO) of Afren, respectively.

The officials were said to have laundered more than $45 million from a $300 million deal
they recommended to Afren, using their illicit proceeds to purchase luxury properties in the
Caribbean, without the knowledge of Afren’s Board.

Background

Prosecutors said Messrs Shahenshah and Ullah created a side deal with one of Afren’s
Nigerian oil partner, Oriental, that would allow them to benefit from payments Afren would
make.

The men recommended a transaction to the Afren Board, who then approved payments of
hundreds of millions of dollars without knowing that Messrs Shahenshah and Ullah stood to
personally benefit.

The transaction was claimed to be necessary to maintain the business partnership, but the
fact that both men stood to benefit personally remained hidden.

Lisa Osofsky, Director of the Serious Fraud Office said: “Greed motivated this crime. Osman
Shahenshah and Shahid Ullah failed in their duties as company directors, abused their
positions and lied to their board.
“Instead of acting in their company’s best interests, they used Afren like a personal bank
account to fund an illicit deal, with no regard for the consequences.

“Fraud corrodes confidence, undermines trust and damages the reputation of the UK at home
and abroad. It is our mission to bring those committing this crime to justice.”

SFO said that Messrs Shahenshah and Ullah recommended that the Afren board agree to a
$300 million payment to Oriental Energy Resources Ltd, the company’s oil field partner in
Nigeria.

Unknown to the Afren board, both men struck a side deal with Oriental which led to 15 per
cent of the $300 milion being paid out to a Caribbean shell company controlled by the
defendants.

The men then used the $45 million to purchase luxury properties in Mustique and the British
Virgin Islands.

A smaller portion of the $45 million laundered was split between Oriental employees and a
close network of Afren staff dubbed ‘The A Team’.

On October 29, at Southwark Crown Court, a judge, Gledhill QC, sentenced both officials of
Afren to prison.
Mr Shahenshah was sentenced to six years jail for one count of fraud, contrary to section 1 of
the Fraud Act 2006; six years concurrent for one count of money laundering, contrary to
section 329 of the Proceeds of Crime Act 2002; and four years concurrent for one count of
money laundering, contrary to section 328 of the Proceeds of Crime Act 2002.

Mr Ullah, received five years jail for one count of fraud, contrary to section 1 of the Fraud Act
2006; five years concurrent for one count of money laundering, contrary to section 329 of the
Proceeds of Crime Act 2002; and four years concurrent for one count of money laundering,
contrary to section 328 of the Proceeds of Crime Act 2002.

The SFO in September said however that Mr Shahenshah had appealed against his
conviction and sentence.

While Afren Plc is an oil company in which a former Nigerian oil minister, Rilwanu Lukman,
was a former chairman and founder, Oriental is owned by Mr Indimi, who is an in-law to
President Muhammadu Buhari.

In 2014 when the issue was first raised, Mr Indimi’s Oriental Energy denied any wrongdoing.
Checks by PREMIUM TIMES also showed that the company is not under any probe in
Nigeria.

Further checks by this newspaper at the UK SFO however shows that prosecutors did not find
sufficient evidence to suggest that individuals at Oriental were complicit in the fraud.

PREMIUM TIMES learnt that it was the prosecutions’ case that Messrs Shahenshah and
Ullah masterminded the crime, were the primary beneficiaries of the fraud and had abused
their position as Afren Directors for personal gain.

“We have successfully prosecuted the individuals who planned, committed and primarily
benefitted from this crime and brought them to justice,” an SFO spokesperson told this
newspaper. “Prosecution decisions are made on the evidence available in accordance with the
UK Code for Crown Prosecutors.”

Why Oriental Was Not Investigated

With the help of its London partner, Finance Uncovered, PREMIUM TIMES learnt that the
SFO decided not to pursue Oriental for a number of reasons.
Details also emerged of why the anti-graft agency did not involve Nigeria’s anti-corruption
agencies.

This newspaper gathered that SFO officials maintained that since the criminal activity
uncovered by the SFO’s investigations were not committed in Nigeria but in the British Virgin
Islands and the UK and witnesses from Afren and Oriental voluntarily cooperated with the
SFO, prosecutors agreed there was no operational need to involve Nigeria’s law enforcement
authorities.

Our reporter also gathered that when called for interrogation, officials at Oriental Energy
promptly cooperated with the UK SFO and honoured the invitation.

The SFO opined that if the officials had been uncooperative, there would have been a reason
to involve the Nigerian authorities.

The agency also concluded that as the crime was not committed in Nigeria, and was not
committed by Oriental, it was not necessary to involve Nigeria’s anti-corruption agencies.

Oriental Energy

Oriental Energy Resources Limited, according to details on its website, was founded by the
chairman, Mr Indimi, in 1990.

In September of that year, the company was awarded OPL 224 by the Federal Government of
Nigeria under the then military ruler, Ibrahim Babangida, with a mandate requirement to
acquire a minimum of up to 1000 km of seismic data and to drill at least three exploratory
wells.
Work began on OPL 224 in 1991 as the company entered into a Technical Services Agreement
with DuPont Nigeria Ltd, acquired the committed 2D seismic survey as well as drilled four
wells including the Ufon discovery well.

This continued until the Nigerian Department of Petroleum Resources gave an approval to
convert OPL 224 to OML 115 on 20 May 1999, as a result of the successful work done on the
block.

In early 2000s, the growth of Oriental Energy proceeded quickly. Ebok marginal field (May
2007) and Okwok marginal field (2006) were awarded to Oriental Energy Resources Limited
from ExxonMobil’s OML 67, through a Joint Venture Agreement (JVA) between the Nigerian
government and ExxonMobil under the Marginal Fields Scheme, as a compensation for the
loss of acreage to ExxonMobil Equatorial Guinea.

The company said it has had strategic alliances with Addax Petroleum (Okwok), Nexen E&P
Services Nigeria Ltd. (OML 115), and Energy Equity Resources Oil & Gas (OML 115).

In 2008, Oriental Energy announced its Technical Services Agreement with Afren Energy
Resources to appraise the Ebok Field and the partnership expanded with Afren signing a JVA
with Oriental Energy and Addax for the development of Okwok (2009), as well as Afren
signing a JVA with Oriental Energy and EER for the exploration and appraisal of OML 115
(2010).
The company says it is currently producing an average of 19, 000 barrels of oil per day from
27 producer wells and has produced over 60 MMbbls from inception to date.

The company’s chairman, Mr Indimi, is in-law to President Muhammadu Buhari. In 2016,

Mr Buhari’s daughter, Zahra, got married to Mr Indimi’s son, Ahmed Indimi