Eni and the Nigerian government have reached a comprehensive settlement, resolving all legal claims and terminating international arbitration proceedings related to the controversial OPL 245 deepwater exploration licence. This agreement clears the path for the development of approximately 500 million barrels of oil resources.

Background of the Dispute

The OPL 245 licence has been the subject of extensive legal proceedings in Europe and Nigeria concerning its acquisition by Eni and Shell in the late 1990s. Italian prosecutors had alleged that a significant portion of the $1.3 billion purchase price was diverted to politicians and middlemen. Following a trial in Italy where all defendants denied wrongdoing, Eni, Shell, and their involved executives were acquitted in 2021.

Terms of the Settlement

The settlement, discussed between Eni's CEO and Nigeria's President, involves the mutual resolution of all claims and the discontinuation of arbitration at the International Centre for Settlement of Investment Disputes. A key outcome is the conversion of the OPL 245 licence into two Petroleum Mining Leases (PMLs 102 and 103) and two Petroleum Prospecting Leases (PPLs 2011 and 2012). Eni will remain the operator of all these leases, in partnership with the state-owned NNPC and Shell.

Development Plans

The settlement enables the development of the long-dormant Zabazaba and Etan discoveries located in deepwater blocks PML 102 and PML 103. Eni plans to utilize a fast-track development approach, deploying a floating production, storage and offloading vessel with a capacity of 150,000 barrels per day. The project will also export 200 million cubic feet of gas per day to the Nigeria LNG facility. The newly created PPLs 2011 and 2012 are noted as having high potential.