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WikiLeaks on Nigeria’s corrupt oil sales at NNPC, Shell, US Ambassador and health of Nigeria’s President

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Nigeria's former, late President Umar Yar'Adua with praying beads

WikiLeaks on Nigeria’s oil, corruption, NNPC, Shell, US Ambassador, Attorney-General Aondoakaa’s demand for millions in bribe money and health of Nigeria’s President.

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Special to USAfricaonline.com and the USAfrica e-group Nigeria360

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The website WikiLeaks has leaked further information regarding the corrupt dealings and illegal sales of oil at the Nigerian National Petroleum Corporation by its former Group Managing Director Engr. Yar’Adua (no relation of the former, late President Yar’Adua), Shell Oil’s pervasive and overwhelming influence inside Nigeria’s government and the alleged demand for millions in bribe money by Nigeria’s attorney-general Aondoakaa.

Exceprts:

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VZCZCXRO7442

OO RUEHPA

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DE RUEHUJA #0259/01 0411610

ZNY SSSSS ZZH

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O 101610Z FEB 09

FM AMEMBASSY ABUJA

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TO RUEHC/SECSTATE WASHDC IMMEDIATE 5253

INFO RUEHZK/ECOWAS COLLECTIVE

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RUEHOS/AMCONSUL LAGOS 0802

RHEBAAA/DEPT OF ENERGY WASHDC

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S E C R E T SECTION 01 OF 03 ABUJA 000259

NOFORN

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SIPDIS

STATE PASS USTR FOR AGAMA

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USDOE FOR GEORGE PERSON AND CHAYLOCK

E.O. 12958: DECL: 10/02/2028

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TAGS: EPET ENRG ELAB PINR ECON SENV PGOV NI

SUBJECT: (C) NIGERIA: SHELL BRIEFS AMBASSADOR ON OIL GAS ISSUES,

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COMMENTS ON PRESIDENT’S HEALTH AND HIGH-LEVEL CORRUPTION

REF: ABUJA 203

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Classified By: Ambassador Robin R. Sanders for reasons 1.4. (b & d).

¶1. (S/NF) SUMMARY: Shell’s regional executive vice president for

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Africa Ann Pickard and government relations representative Peter

Francis met with the Ambassador on January 27 in Abuja and provided

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an update on problems in the oil and gas sector. Pickard said that

things were going from bad to worse, especially the security

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situation. She said that Nigeria now had one of the highest negative

ratings for maritime operations, creating problems for Shell in

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hiring oil tankers to load, as tanker operators will work only under

highly selective conditions. Last year there were about 80 piracy

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attacks on land and water combined. This year already 15 have been

tallied, which includes 3 for Shell and 3 for Exxon. On corruption,

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Pickard said that Nigerian entities control the lifting of many oil

cargoes and there are some “very interesting” people lifting oil.

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Oil buyers would pay NNPC GMD Yar’Adua, Chief Economic Advisor Yakubu

and the First Lady Turai Yar’Adua large bribes to lift oil. Pickard

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also reported an instance of the Attorney General Aondoakaa allegedly

soliciting a $20 million bribe to sign a document. The International

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Oil Companies (IOC) are quite concerned about the “very flawed” new

petroleum sector energy bill. The IOCs will be asking U.S., Dutch,

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and U.K. COMs to convey points on the bill to GON policymakers.

Pickard agreed that the President’s health is a guessing game. She

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said that in her recent meetings with Yar’Auda he seems alert, though

very drawn in the face, thin, and frail. Her information is that the

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President was not in danger of dying soon, but also was unlikely to

ever fully recover from his ailments. (Note: see septel on oil/energy

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sector issues for the Ambassador’s meeting with the new Minister of

Petroleum Resources. End Note). END SUMMARY.

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¶2. (C) Shell’s regional executive vice president for Africa Ann

Pickard and government relations representative Peter Francis met

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with the Ambassador on January 27, 2009 in Abuja and provided an

update on problems in the oil and gas sector. Pickard reported that

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Shell’s meeting with Minister of Petroleum Resources Dr. Rilwanu

Lukman scheduled for earlier that day had been cancelled; the third

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week in a row where key appointments had fallen through, with the

excuse of being summoned to the Presidential Villa. (Note: Emboffs

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have observed that meetings with ministers and senior staff are

indeed often cancelled with the explanation that they have been

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summoned to the Presidential Villa, even when the President is out of

town. End note). Econ Counselor and Econoff (notetaker) also

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attended the discussion.

– – – – – – – – –

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FROM BAD TO WORSE

– – – – – – – – –

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¶3. (C) The Ambassador took the opportunity to share with Pickard that

the Mission was in the midst of completing its Strategic Plan and

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asked Pickard where she thought Nigeria was headed. Pickard said that

things were going from bad to worse, especially in terms of security.

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She said that Nigeria now had the highest negative rating for

maritime security, creating problems for Shell in hiring oil tankers

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to load; tankers will work only under highly selective conditions.

She also noted that late on the evening of Saturday January 17,

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Nigerian militants attacked and boarded two vessels at a Shell crude

oil loading platform in Bonny and took eight crew members hostage.

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Standard procedure on the tanker was followed: the ship went into

immediate lock down; there were no injuries or fatalities from the

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boarding. The eight Nigerian crew members who were taken hostage were

later released. The pirates who went through the sections of the

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boat to which they were able to gain access, smashing and stealing

computers, electronics, and personal items of the crew members. The

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second vessel was a tug boat towing a supply vessel from Bonny to

Calabar. Last year there were about 80 incidents of piracy; this

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year already 15 had been tallied, which includes 3 for Shell and 3

for Exxon. GON officials have told Shell to “hire more security.”

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The price of doing business in the oil and gas sector in Nigeria

continues to climb she concluded. [Note: The International Maritime

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Bureau (IMB), a division of the International Chamber of Commerce –

www icc-ccs org – reports that the waters off the Gulf of Guinea

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(Nigeria) remain the second worst, with 40 incidents in 2008 to the

Horn of Africa (Somalia) with 42 recorded incidents. The IMB notes

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that in 2009 the Horn of Africa will be more intense as Spring comes

due to the large number of foreign warships in the region on active

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patrol to ensure the safety and security of vessels. The same

increased security is not expected for Nigeria in 2009. End Note]

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– – – – – – – – – – – – – – – – – – – – – – – – –

SHELL BELIEVES COUP UNLIKELY; CORRUPTION WORSENING

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– – – – – – – – – – – – – – – – – – – – – – – – –

ABUJA 00000259 002 OF 003

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¶4. (S/NF) The Ambassador asked what Shell’s thoughts were on any

potential for a coup. Pickard answered that there is little

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intellectual capital to plan and execute a coup and Shell sees little

potential for one. Pickard then went on to say that corruption in

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the oil sector was worsening by the day. The Ambassador asked for a

few examples. Pickard said that Nigerian entities control the

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lifting of many oil cargoes and there are some “very interesting”

people lifting oil (People, she said that were not even in the

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industry). As an example she said that oil buyers would pay Nigerian

National Petroleum Corporation (NNPC) General Managing Director

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Yar’Adua, (Note: not related to President Yar’Adua. End Note) Chief

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Economic Advisor Yakubu, and the First Lady Turai Yar’Adua large

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bribes, millions of dollars per tanker, to lift oil. The IOCs

control the liquefied petroleum gas (LPG) cargos, so GON actors do

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not have the same opportunity for illicit gain. Pickard also said a

former associate of hers (protect) had told her he had been present

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when Attorney General Aondoakaa had told a visitor that he would sign

a document only if the visitor paid $2 million immediately and

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another $18 million the next day.

– – – – – – –

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VERY BAD BILL

– – – – – – –

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¶5. (C) Pickard reported that Shell, Exxon-Mobil and Chevron all have

big license review disputes with the GON. Shell has taken its

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dispute to court and the court is supporting Shell’s position.

According to her, Shell is stepping back for the moment, however, to

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see how the other two majors negotiation fair, but is not taking its

case out of court yet. The IOCs are quite concerned about the “very

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flawed” new petroleum sector energy bill. The bill is silent on what

fiscal regimes would be applied. Shell says that the bill could

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reduce the corporation’s overall value in Nigeria. GON discussions

around the bill have mentioned the possibility of moving to five-year

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licenses and prohibiting exploring both oil and gas from the same

source, which would contradict how oil and gas extraction works in

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practice. The bill is silent on joint ventures; it just states that

NNPC will be incorporated. Pickard said the bill was “likely to sail

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through.” The IOCs will be asking U.S., Dutch and U.K. COMs to

convey points on the bill to GON policymakers. (Note: Pickard

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mentioned that the IOCs will not share company information directly;

they will hire consultants, like McKinsey, to produce common themes

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so the messages from the IOCs to be shared with the relevant

Ambassadors are clear and consistent. End note). Pickard lamented

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that the expected cycle of petroleum is at least five years for the

first oil to flow, another 10 years of production to begin to break

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even. These numbers change when oil is $40 per barrel instead of $100

per barrel. Hence, a five year license would not be an incentive for

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investment and development.

– – – – – –

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GAS ISSUES

– – – – – –

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¶6. (C) The Ambassador said that the Mission was looking at

performance measures for the economy, i.e. the linkage between the

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country’s electricity output and gross domestic product (GDP). The

Ambassador shared that the Mission feels strongly that gas for

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feedstock is the key to Nigeria’s power production, which is only

about 2,800 average megawatts for a country of 140 million people.

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Pickard agreed and added that the U.S. got it wrong on its domestic

natural gas policies, which it took over 20 years to sort out. So it

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is not surprising that Nigeria has it wrong at this point. She said

there is not adequate infrastructure for gas. Gathering plants and

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pipelines to carry the product to the power plants still have to be

financed and built. The Nigeria Independent Power Projects (NIPP)

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were located where there is no gas and no infrastructure. In

addition, the international oil companies were coerced into building

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a power plant each, something they have no expertise in, and they are

scrambling to deliver gas to these plants.

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– – – – – – – – – – – – – – – – – – – – – –

YAR’AUDA VACATION IS PERHAPS SOMETHING ELSE

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– – – – – – – – – – – – – – – – – – – – – –

¶7. (S/NF) Pickard agreed that the President’s health is a guessing

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game. She said that in her recent meetings with Yar’Auda he seems

alert but drawn in the face and frail. She reported that a Julius

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Berger (protect) contact says that the President was not in danger of

dying soon but has serious ailments from which he will never fully

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recover. Pickard shared that Berger provides transportation

including planes for the President and has reportedly flown in

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doctors and technicians to attend the President (reftel). She said,

for instance, that her Berger contact confided that they flew the

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President from Germany to Saudi in September 2008. Additionally, the

Berger contact thought the President would not return to the Villa

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ABUJA 00000259 003 OF 003

offices, as they were moving the President’s personal things out of

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the Villa. (Note: What we think this means is that Yar’Adua is

spending most of his time in the presidential residence and not in

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the Villa offices. End Note).

– – – – – – – – – – – – – – – – – – – – – –

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HOPES THAT OIL NATIONALISM CAN BE TEMPERED

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¶8. (C) The Ambassador asked how comfortable Shell was with the new

appointment of Dr. Rilwanu Lukman as Minister of Petroleum Resources,

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and the appointment of Mohammad Sanusi Barkindo as the new NNPC GMD.

Pickard sees the nationalism card cooling with the removal of former

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NNPC GMD Yar’Adua, given that new Minister of Petroleum Lukman is

more “pragmatic” and will hold sway over deputy Minister Ajumogobia.

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(Note: Ajumogobia’s technical assistant told EconOff in a meeting on

January 14, 2009 that the State Minister was focusing on Gas, since

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before the mass cabinet change he was State Minster of Petroleum,

with a separate State Minster for Gas.) End Note. She said she was

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also okay with NNPC chief Barkindo. She has worked with Barkindo

several times over the past few decades, especially when they were

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both working climate change. She said Barkindo led Nigeria’s

technical delegation to climate change negotiations that produced the

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United Nations Framework Convention on Climate Change (UNFCCC)and the

Kyoto protocol to UNFCCC during while he served on its Bureau at

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various times. She indicated that although his undergraduate studies

were in political science, he obtained his MBA from Southeastern

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University in Washington DC and did postgraduate work in petroleum

economics and management at Oxford University. Although she also said

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terms like nationalistic and Chavez she however said that she thought

he could be steered in the right direction on the petroleum sector.

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– – – –

COMMENT

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– – – –

¶9. (C) Although Pickard clearly seems frustrated with the way things

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are going in the maritime security, oil sector legislation, and

corruption which affects Shell’s bottom line, it was useful to hear

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that she has hopes for the new Petroleum Minister and NNPC chief.

Septel on the Ambassador’s meeting with new Petroleum Minister Lukman

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will address many of these same issues.

¶10. (U) This cable was coordinated with Consulate Lagos. SANDERS

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—–

USAfrica and USAfricaonline.com (characterized by The New York Times as the  most influential African-owned, U.S-based multimedia networks) established May 1992, our first edition of USAfrica magazine was published August 1993; USAfrica The Newspaper on May 11, 1994; CLASSmagazine on May 2, 2003; www.PhotoWorks.TVin 2005.

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Obama’s Africa agenda, our business and democracy. By Chido Nwangwu, Publisher of USAfricaonline.com, USAfrica The Newspaper, Houston, USAfricaonline.com and CLASS magazine and The Black Business Journalhttps://usafricaonline.com/chido.obamaafrica09.html

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2 Comments

  1. way to go Nigerian govt officials,you guys have really done well for yourselves, of course the day reckoning is by the corner,when it does,there will be no hiding place for all of you. 

  2. US AMBASSADOR TO NIGERIA добави в адреси
    До: undisclosed-recipients:;
    Относно: GREAT SUCCESS AT LAST
    Дата: Петък, 2011, Април 22 00:42:48 EEST

    US AMBASSADOR TO NIGERIA
    11 GARKI ROAD ABUJA
    ABUJA, NIGERIA

    ATTN: BENEFICIARY,

    I SHALL BE COMING TO YOUR COUNTRY FOR AN OFFICIAL MEETING AND I WILL BE BRINGING YOUR FUNDS OF $1.2M ALONG WITH ME BUT THIS TIME I WILL NOT GO THROUGH CUSTOMS BECAUSE AS AN AMBASSADOR TO NIGERIA, I AM A US GOVERNMENT AGENT AND I HAVE THE VETO POWER TO GO THROUGH CUSTOMS.

    AS SOON AS I AM THROUGH WITH THE MEETING I SHALL THEN PROCEED TO YOUR ADDRESS. (SEND YOURCELL PHONE NUMBER AND THE ADDRESS WHERE YOU WANT ME TO BRING THE PACKAGE).

    YOU HAVE REALLY PAID SO MUCH IN THIS DELIVERY THAT MAKES ME WONDER. YOU ARE A VERY LUCKY PERSON BECAUSE I SHALL BE BRINGING IT MYSELF AND THERE IS NOTHING ANYONE CAN DO ABOUT IT.

    YOUR PACKAGE($1.2M) MUST BE REGISTERED AS AN AMBASSADORIAL PACKAGE FOR ME TO DEFEAT ALL ODDS AND THE COST OF REGISTERING IT IS $200.THE FEE MUST BE PAID IN THE NEXT 50 HOURS VIA WESTERN UNION SO THAT ALL NECCESSARY ARRANGEMENT CAN BE MADE BEFORE TIME WILL BE AGAINST US

    SEND THE FEE VIA MONEY GRAM OR WESTERN UNION MONEY TRANSFER

    RECEIVER'S NAME: Emmanuel Abba
    ADDRESS: LAGOS, NIGERIA
    TEXT QUESTION: COLOR
    ANSWER: BLUE
    AMOUNT: $200

    AS SOON AS YOU SEND THE FEE MAKE SURE YOU SEND ME THE PAYMENT INFORMATION.AND I WILL LET YOU KNOW AS SOON AS I BUCK A FLIGHT AND I EXPECT YOU TO COMPLY BEFORE THEN SO THAT THE DELIVERY CAN BE COMPLETED. IF YOU DO NOT COMPLY, THEN IT WILL NOT

    BE MY FAULT IF YOU DO NOT RECEIVE YOUR PACKAGE

    AMBASSADOR JAMES ROBERT SANDERS

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