BLP Oil & Gas Update Creative Doc.pdf April 2014 | Page 7

state law. The judge did give leave for Pemex to pursue its conversion claims
at trial, but commented: “In order to hold any individual defendant liable for
conversion, [Pemex] must trace condensate that was actually stolen in
Mexico to the individual defendant. [Pemex] must also present evidence
from which a fact-finder could form a reasonably certain estimate of the
amount of stolen condensate, if any, that each defendant converted.”
“Curbing oil theft must be of the highest priority to the Nigerian government if
it wishes to help safeguard the country’s economic future.”
The judge’s comments show one of the central evidential difficulties for an
entity to pursue claims relating to stolen oil. Can it track, with sufficient
certainty, the passage of a specific amount of stolen oil from the source of
the theft through the transport phase to its ultimate recipient? If it cannot, it
may struggle to succeed in any court action to recover the oil or the
proceeds of its sale.
It is unclear whether or not Pemex has this quality of evidence but the
Nigerian government and oil companies should monitor the outcome to
pursue oil theft in the country.
Curbing oil theft must be of the highest priority to the Nigerian government if it
wishes to help safeguard the country’s economic future. If it is able to
develop the necessary will, there are a number of steps that the government
can take now to prevent the fraud and to trace the stolen oil and its
proceeds.
If sufficient links to the UK can be established, then the English court stands
ready to assist civil proceedings brought in Nigeria to recover the oil or its
proceeds.

About BLP Law
Whilst demand for energy and natural
resources continues to grow, creating
great opportunity for the sector, a
range
of
economic,
political,
commercial
and
physical
or
technological issues create sources of
risk that require successful resolution.
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