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1/ I'm in court at the Palace of Justice in Milan this morning for the next hearing in the trial of Royal Dutch Shell and Eni. We're expecting to hear from an expert witness on Nigerian law brought by Eni and a person who wrote Eni's due diligence on the deal. Thread to follow. 
2/ Felicia Segun is introduced as Eni's expert witness. She's an oil and gas lawyer and a senior partner at ACAS-Law, a Nigerian law firm. She says she also sits on the boards of several oil and gas companies and the board of an international bank.
3/ Ms Segun lays out that up until the year 2000 ministers awarded oil licenses by direct award, they have discretionary power to do so. Then after 2000 there have been public bidding rounds, selective non-public bidding rounds and some direct awards.
4/ Ms Segun says that all the awards of OPL 245 were effectively directly awards having already laid out that she considers selective bidding, reallocations and extensions effectively the same as direct awards.
5/ Ms Segun says the Nigerian local content legislation is very confusing. Claims the 2010 local content law giving preference to "Nigerian Independent Operators" in the award of new blocks doesn't define this group of companies clearly and they are only given first consideration
6/ Ms Segun disagrees with the opinion expressed by a previous expert witness that the OPL 245 tax exemptions were not in line with the law saying that payments to governments shouldn't attract taxes.
7/ Ms Segun disagrees again with the previous witness, Dr Ayoade, that is is irregular to not have any royalty oil, cost oil or profit oil in a PSC, and says that the deep water legislation doesn't require a royalty and as NNPC is not a party there would be no profit oil.
8/ Ms Segun says that the back-in rights for OPL 245 were open to negotiation under the law and therefore the back-in rights included in the 2011 deal are legal.
9/ Ms Segun says that as the $1.1bn payment by Shell and Eni for OPL 245 was for settling claims on the block it shouldn't be considered "public funds" and therefore wasn't obliged to go into the consolidated revenue fund. She also points out the President ordered the deal.
10/ Ms Segun points to the legal case brought by former Nigerian Attorney General Adoke saying that he is protected if carrying out the lawful directives of the president.
11/ Ms Segun says that the Nigerian government had the power to withdraw the OPL 245 license as Malabu had not paid the signature bonus but they chose not to enforce this. She says the late payment of signature bonuses by Nigerian companies is common.
12/ Ms Segun is now being cross examined by the public prosecutor. She's asked if she considered the allocation to Malabu as part of her assessment of the deal's legality. But she says she doesn't know if Dan Etete had a formal role in Malabu.
13/ Ms Segun is aware of the code of conduct for public officials being place in 1998, and says Mr Etete's role could raise questions of conflict of interest. She claims though that 1998 award to Malabu has been confirmed several times by the Nigerian government.
14/ Ms Segun is pressed on a textbook she cited in he report, the book also laid out that the 1998 indigenous award lacked transparency due to their discretionary nature. She agrees that blocks were handed out to those close to ministers including the seamstress of Abacha's wife.
15/ Ms Segun had named one block awarded directly that wasn't a marginal field, Shell discovered oil there in 2005 but the prosecutor cites @WoodMackenzie saying it seen as high risk and it has little or no commercial value. Segun disagrees on the point of commercial relevance.
16/ The prosecutor goes through all the other direct awards (awards outside of licensing rounds) that aren't marginal fields cited in the 2000s, they all seem to be re-awards to Nigerian companies of earlier awards.
17/ The prosecutor asks if sole risk deals had been given to non-Nigerian companies. Segun says historically but not recently, she can recall only deals in 1990.
18/ The prosecutor goes through companies with sole risk contracts asking if they are Nigerian owned. Segun says either they are Nigerian or doesn't know. She is asked if OPL 245 is the only sole risk contract awarded to non-Nigerian companies. She says yes, since the mid-90s.
19/ The prosecutor asks if there was a legitimate reason for The $1.1bn to go through an FGN escrow account. Ms Segun says yes as the funds were not intended to be used for the benefit of Nigeria. Says yes its important that there is transparency with money received by government
20/ Ms Segun is asked if she's familiar with @nigeriaeiti She says yes, transparency in important, there should be records of payments to the government and money paid out. But she admits she didn't look at this in her report to the court on the legitimacy of the escrow deal.
21/ That's the end of Ms Segun's testimony, we're now hearing testimony from the next witness Alexander Leslie, a former manager at The Risk Advisory Group, a "business intelligence firm".
22/ Mr Leslie explains that they research business's counterparties using public sources or off the record conversations with sources or local contacts, sometimes through intermediaries who are paid though they're told not to pay sources.
23/ Mr Leslie says that he can't say if Eni was a client of The Risk Advisory Group (TRAG), as he signed confidentiality agreements stopping him identifying clients but told by the judge his liability is waived in these proceedings then he confirms yes Eni was a client.
24/ TRAG wrote reports for Eni in 2007 and 2010, Leslie says he is the author of the 2010 report. The reports say that all of their sources were united in finding Dan Etete was the owner of Malabu.
25/ Leslie says that he remembers Etete was an original shareholder of Malabu and while he had removed himself from the shareholders register public press reports beyond number and the opinions of their sources said he still controlled the company.
26/ One of the directors TRAG thought wasn't real as they were told his name "Munamuna" in Hausa slang meant "Hanky Panky', Mr Leslie explains this is an archaic term for "sexual activity".
27/ Leslie says he can't remember how he received information used in his 2010 TRAG report, intermediaries usually submit their own written reports, the prosecutor says they found underlying documentation for the 2007 TRAG report but not for 2010.
28/ Leslie says he didn't now who the sources were cited in his report other than for example a "government advisor". The prosecutor presents him with an email in his report addressed directly to him with the author redacted. Leslie won't say who sent it, or even who he thinks.
29/ Leslie says he doesn't recall receiving any documents from Eni, he says Malabu was a very well known company so they only needed the name, not documents. Prosecutor points to where the report says Eni gave TRAG additional documentation. Leslie says he didn't know about that.
30/ Cross examination now and back to Mr Hanky Panky in questions from Eni. They say the 2007 report said he was a real person, connected to the ruling PDP political party, the later report says he's fictitious, Mr Leslie says he clearly hadn't noticed the contradiction.
That's it for today. The next hearing is next Wednesday. In the meantime do check our report on the impact of the terms of the deal on Nigeria #takethefuture and do send me any questions. I'm no lawyer but I'll do my best to answer! globalwitness.org/en-gb/campaign…
