Kellog Brown & Root in Nigeria Corruption Case
Kellogg Brown & Root in Nigeria Corruption Case
The firm Halliburton acquired Dresser Industries in the year of 1998. Among Dresser’s businesses was M. W. Kellog, which was combined with an existing Halliburton business and renamed Kellog Brown and Root. By that time, Kellog was expecting to build a series of liquefied natural gas in Nigeria, but in order to do that it was required to win an initial contract form the Nigerian Government. At the beginning everything was going according to plans, however; when the consortium was deep in final negotiations, the Nigeria’s oil minister was removed from his charge and replaced. So, not taking any risks, Kellog decided to hire to the British lawyer Tesler, in order to secure the contracts; the main reason why Kellog took that decision was because Tesler succeed in a similar previous situation in Nigeria years before. However, the payment given to Tesler was far out of proportion to the services he provided. In the end, it was revealed that this was only a cover, and that the real reason why so much money was given to Tesler, was that he had to use part of that money in order to bribe to the General Abacha, some governmental officers and executives from the consortium. Unfortenly, this strategy was repeated over and over. In the end, Tesler was paid with $132.3 million of dollars by the consortium for wining all the contracts in Nigeria since the year of 1999 until 2004. After all this finally came out in June 2004, Halliburton fired Jack Stanley and cut its relationship with Tesler; however, this was not enough to dismiss the rumors and troubles, so finally in the 2005 Halliburton decided to put KBR up for sale.
Al l this he did with the help of corruption, which is why this case was great scandal. In general this speaks about corruption that is lived in Nigeria and the ease of making contracts as long as one has money
Personal Group Analysis of Kellogg Brown Case
1. The key issue is that the payments were not
The firm Halliburton acquired Dresser Industries in the year of 1998. Among Dresser’s businesses was M. W. Kellog, which was combined with an existing Halliburton business and renamed Kellog Brown and Root. By that time, Kellog was expecting to build a series of liquefied natural gas in Nigeria, but in order to do that it was required to win an initial contract form the Nigerian Government. At the beginning everything was going according to plans, however; when the consortium was deep in final negotiations, the Nigeria’s oil minister was removed from his charge and replaced. So, not taking any risks, Kellog decided to hire to the British lawyer Tesler, in order to secure the contracts; the main reason why Kellog took that decision was because Tesler succeed in a similar previous situation in Nigeria years before. However, the payment given to Tesler was far out of proportion to the services he provided. In the end, it was revealed that this was only a cover, and that the real reason why so much money was given to Tesler, was that he had to use part of that money in order to bribe to the General Abacha, some governmental officers and executives from the consortium. Unfortenly, this strategy was repeated over and over. In the end, Tesler was paid with $132.3 million of dollars by the consortium for wining all the contracts in Nigeria since the year of 1999 until 2004. After all this finally came out in June 2004, Halliburton fired Jack Stanley and cut its relationship with Tesler; however, this was not enough to dismiss the rumors and troubles, so finally in the 2005 Halliburton decided to put KBR up for sale.
Al l this he did with the help of corruption, which is why this case was great scandal. In general this speaks about corruption that is lived in Nigeria and the ease of making contracts as long as one has money
Personal Group Analysis of Kellogg Brown Case
1. The key issue is that the payments were not