By Michael M. Phillips

Vice President Teodorin “Teddy” Nguema Obiang was in a mood for payback. The Obiangs have run the oil-rich Central African country of Equatorial Guinea like a family ATM since 1979, accumulating mansions in Paris and Malibu, Ferraris and Bugattis, and at least three superyachts, according to court documents. And now a South African court was seizing Nguema Obiang’s two high-end Cape Town villas and the Blue Shadow, the yacht that carries his jet-ski collection while he vacations on one of the other two.

He lashed out at “racist scammers” and “white slaver lawyers from Cape Town.” He threatened to bar South African ships from Equatorial Guinea’s waters and South African planes from its airspace.

Days later, Equatorial Guinean police arrested two South African oil workers, accused them of trafficking cocaine and threw them in prison. The men’s family members, employers and U.S. officials say their arrest was direct retaliation against South Africa by Nguema Obiang, son of President Teodoro Obiang Nguema Mbasogo and de facto head of the country’s feared security services.

“This is something that Teodorin is known to do,” says Mark L. Asquino, a former U.S. ambassador to Equatorial Guinea and now a senior adviser to Horizon Engage, a New York-based political risk consulting firm. “He can be quite vengeful.”

A year on, the oil workers, Frederik Potgieter, 54 years old, and Peter Huxham, 55, remain in an isolated prison in a forest clearing deep in the Central African hinterlands.

Equatorial Guinea’s ambassador in Washington says that, as far as the government is concerned, justice is being done to a pair of drug dealers in a case that has nothing to do with the vice president’s assets. But he also hints the Obiangs might be open to a trade.

State hostages

The world has recently seen a spate of state-sponsored hostage-takings, with governments using humans as pawns in diplomatic negotiations.

Venezuela, for instance, recently freed 10 Americans for President Nicolás Maduro’s moneyman, who was facing money-laundering charges in Miami. Last year, the U.S. recovered five Americans jailed in Iran in exchange for several Iranians held in the U.S. and the release of $6 billion in seized Iranian oil revenue.

Former U.S. Marine Paul Whelan has been imprisoned in Russia since 2018, and Wall Street Journal reporter Evan Gershkovich has been held in Moscow’s Lefortovo Prison for
more than a year. Both have been accused in separate cases of espionage, allegations they deny, and the U.S. government has declared them wrongfully detained.

The Biden administration lists nine countries, from Nicaragua and North Korea to Iran and China, where U.S. citizens face an elevated risk of wrongful detention. Equatorial Guinea isn’t among them.

The imprisonment of oil workers Potgieter and Huxham, family members and U.S. officials say, shows even the smallest countries playing the hostage-taking game, in this case to gain leverage in an international property dispute.

“To us it’s quite clear what’s going on here,” says Shaun Murphy, spokesman for the families.

Oil riches and a strategic spot

The case alarms American officials. For decades, U.S. oil companies have drilled in Equatorial Guinean waters, and diplomats now routinely point to the case of the two
South Africans to warn American firms their employees aren’t safe there.

Washington finds itself in a pinch, however. The Biden administration criticizes Equatorial Guinea’s human-rights record. But it is also worried the Obiangs, if at odds with the U.S., might allow China to build a naval base on the Atlantic Ocean. Washington sees the prospect of Chinese warships rearming and refitting at an Atlantic port as a national-security threat.

American officials have limited leverage in the case of the South African oil workers. The men aren’t American citizens. And while they were working on oil ships operated by Exxon Mobil and Chevron, they were employed by a Dutch oil-service company, SBM Offshore.

The story is a convoluted one, in which Potgieter and Huxham find themselves entangled in a legal dispute and diplomatic shouting match that originally had nothing to do with them.

Equatorial Guinea, with a population of 1.5 million, is composed of a series of islands in the Gulf of Guinea, and a rectangular chunk of mainland Africa wedged between Gabon
and Cameroon.

Spain’s only sub-Saharan African colony, it gained independence in 1968, and soon fell under the rule of Francisco Macias. Macias declared himself president-for-life under the motto, “In politics, the victor wins and the loser dies.”

He burned the villages of his perceived enemies. His men murdered dozens in a soccer stadium while loudspeakers played the hit, “Those Were the Days.”

In 1979, rebellious troops ousted Macias from power. He escaped with suitcases full of cash, but was captured in the forest. The new junta tried him in a movie theater in Malabo, the capital city. Less than five hours after the guilty verdict, a firing squad executed him at the notorious Black Beach prison.

His nephew, then-Lt. Col. Teodoro Obiang Nguema, seized power and has held it tightly ever since.

Human-rights advocates have accused the senior Obiang of human-rights abuses, including torture and extrajudicial imprisonment of his opponents. Diplomats and
international law-enforcement agencies say the president and his family helped themselves to public coffers filled by the discovery, in the 1990s, of vast offshore oil deposits.

Among other oil-fuelled projects, the president built a scaled-down version of St. Peter’s Basilica in his hometown, Mongomo, not far from where Potgieter and Huxham are now imprisoned.

But it is his son, Nguema Obiang, commonly known as Teodorin or Teddy, who has displayed his wealth most ostentatiously.

Nguema Obiang graduated from a position as his father’s minister of agriculture and forestry, to second vice president, to first vice president, head of the state security apparatus and heir apparent to the presidency. In many ways, Nguema Obiang is already doing his father’s job, including addressing the United Nations General Assembly in September.

The government touts him as the people’s champion in the fight against corruption and nepotism and he himself has said that his wealth came from legitimate government
contracts. “The country cannot move forward with corrupt people,” he wrote last year.

The U.S. Department of Justice accused the younger Obiang of amassing $300 million on a $100,000-a-year ministerial salary “through relentless embezzlement and extortion.” In a 2014 settlement with the federal government, Nguema Obiang surrendered a $30 million cliff-top Malibu mansion, a $530,000 Ferrari 599 GTO and several life-size Michael Jackson statues, part of his large collection of Jackson memorabilia. One federal asset-seizure suit against Nguema Obiang was identified in court documents as “United States of America v. One White Crystal-Covered ‘Bad’ Tour Glove et al.”

In 2021, a French court upheld his conviction for embezzlement and laundering public funds. The court ordered the seizure of EUR150 million in ill-gotten assets, including a collection of supercars and a mansion on tony Avenue Foch in Paris. He received a suspended three-year prison sentence.

Crisantos Obama Ondo, Equatorial Guinea’s ambassador in Washington, said, “The accusations made against the presidential family of Equatorial Guinea are unacceptable, intolerable, disrespectful and above all unfounded.” The country, he added, has no “wealthy people” at all.

Villas and superyachts

Among the luxuries Nguema Obiang acquired are a seaside villa in Cape Town’s Clifton Beach, originally built for servicemen returning from World War II, and a house in the wealthy Cape Town suburb of Bishopscourt, immaculately kept by staff required to cover their shoes while inside. The two houses are worth an estimated $6 million.

Then there is the Blue Shadow, a 220-foot superyacht.

The boat was originally built for a wealthy Saudi, according to a former crew member. It briefly passed through the hands of an Emirati middleman and, on June 24, 2019, while the yacht was in the Mediterranean, the middleman formally sold it to Equatorial Guinea’s Ministry of Defense, according to ship documents.

Nguema Obiang soon fired the yacht’s French captain and crew members. His criminal conviction in France still stung, and he didn’t want Frenchmen aboard, according to the former crew member.

That summer, Nguema Obiang hosted shipboard parties as the Blue Shadow cruised around Sardinia, Capri and Sicily, the crew member says.

Nguema Obiang had personal use of two other superyachts, Ice and Ebony Shine, though they were also officially Ministry of Defense property. Blue Shadow served as the supply ship for the other two, carrying water-sports gear and women flown in for parties, mostly from Latin America, according to the crew member.

One Cayman Islands registry document shows the Blue Shadow carrying 24 smaller watercraft, including 15 jet skis; a 36-foot fishing boat that lists for $400,000; a James Bondesque Gibbs Quadski, which converts from an off-road vehicle into a jet ski with the press of a button; and a Seabreacher, a craft that can race along the surface at 60 miles an hour, dive 5 feet underwater, breach the surface and shoot 20 feet into the air. Nguema Obiang had the Seabreacher painted to resemble a marlin, according to the crew member.

“It’s not a military vessel in any way, shape or form,” says the former crew member.

The Blue Shadow did play a key role in legal battles to come.

A business deal gone wrong

In 2011, a South African businessman named Daniel van Rensburg tried to start an Equatorial Guinean airline with Gabriel Mba Bela, a member of the Obiang family, and then-mayor of Malabo.

6 May 2024 00:01 ET The Dictator’s Son Wanted His Yacht Back. That’s When Trouble Started for Two Oilmen. — WSJ -2-

The deal went south and, according to a 2021 a South African court ruling, Nguema Obiang sent his personal security force to arrest van Rensburg on Mba Bela’s behalf. Van Rensburg was never tried. But he spent close to 500 days locked up, most of the time in Black Beach prison. Prisoners moved freely inside of the facility, van Rensburg recalls. Women and children were mixed in with criminals, political prisoners and others who had gotten on the wrong side of the regime. He remembers an 11-year-old being held for stealing a banana.

“It’s a free-for-all inside — it’s a survival thing,” he says. “You lie in open space, and you can be preyed upon if you’re weak.”

Van Rensburg says he saw other prisoners beaten while handcuffed. There wasn’t enough water to bathe regularly. There were two toilets for 400 prisoners, and no toilet paper. Twice he contracted cerebral malaria.

“I was just left in there to rot or die of some disease,” van Rensburg says. “It’s the worst possible thing you can think of.”

He got out in 2015 after a new judge realized he had never been charged, tried or convicted.

Van Rensburg took shelter at the South African embassy and eventually reached home. The judge fled the country.

Seized assets

Van Rensburg sued Nguema Obiang in South Africa in 2015, arguing that as de facto head of Equatorial Guinea’s security services, the vice president ultimately gave the orders that
kept him imprisoned.

The Western Cape High Court sided with van Rensburg and, in 2021, ordered Nguema Obiang to pay almost 40 million rand, the equivalent of $2.8 million at the time, plus interest and legal costs.

“This is a case that epitomizes a sheer abuse of power and authority by the defendant,” the court said. Nguema Obiang “was hell-bent to ensure that the plaintiff does not leave
prison and that he was tortured and abused,” it said.

Nguema Obiang has appealed the ruling.

Worried that Nguema Obiang wouldn’t pay up, van Rensburg asked to seize his South African assets as collateral.

The court initially allowed van Rensburg to sell off the furniture from the two villas. Early last year, the court ordered the attachment of both houses and the Blue Shadow,
which was undergoing repairs in Cape Town.

On Feb. 7, 2023, a Cape Town sheriff seized the yacht.

When the South African ruling came down, Teddy Nguema Obiang lashed out on the
internet. The Blue Shadow was a military vessel “that the racists of Cape Town” were
holding to “cheat me out of $2 million,” he wrote.

“I have the $2 million,” he wrote, “but I will never pay it.”

A drug charge

Potgieter and Huxham worked as engineers on oil ships in the same tiny country for the same Dutch company, SBM Offshore, but, according to their bosses and families, they never met until Equatorial Guinean authorities accused them of running a joint cocaine- trafficking operation.

Potgieter worked on a Chevron ship, FPSO Serpentina, that collected oil from the Equatorial Guinean seabed. Huxham, a dual South African-U.K. citizen, was on an Exxon
Mobil ship, FPSO Aseng.

Their routines were similar: some five weeks on the water, then home for a break. On Feb. 9, 2023, two days after the sheriff seized the Blue Shadow, their schedules overlapped and both men were at the Anda China Hotel, in Malabo, waiting to fly out the following day.

At 10:30 p.m., the hotel receptionist called them to the lobby. The men left their belongings in their rooms, according to SBM and court documents filed by the men’s
attorneys, and headed down. Waiting there were police agents, who took them into custody, claiming to have found bags of cocaine in their backpacks.

But the police neglected to search the men’s hotel rooms, and never saw, much less seized, their backpacks, SBM staff say. Obama Ondo, Equatorial Guinea’s ambassador, says the investigation and the men’s subsequent conviction followed the regular judicial process, but declined to discuss details of the case.

Police took Potgieter and Huxham to a state security-service building, known to locals as Guantanamo. As a state-television camera rolled, agents interrogated the men in front of black plastic bags filled with white powder.

The men, wearing shorts and T-shirts, an edge of panic in their voices, denied any knowledge of the alleged drugs. “No, no– never in my life,” said Potgieter, vigorously
shaking his head.

“It’s definitely not mine,” said Huxham.

SBM delivered mattresses, sheets and food for the men. A week after their arrests, Potgieter and Huxham were transported to Oveng-Azem prison, deep in the virgin forests of Equatorial Guinea’s mainland.

Van Rensburg quickly released the Blue Shadow, in part because of the potential maintenance costs should the court reverse itself and decide it was an Equatorial Guinean military yacht and not Nguema Obiang’s personal property.

Van Rensburg’s team also hoped the move might persuade Nguema Obiang to release Potgieter and Huxham.

It didn’t.

Nguema Obiang triumphantly posted footage of the Blue Shadow leaving Cape Town and heading out to sea. “They underestimated us, and we showed them that we know how to vigorously defend ourselves,” he wrote. “This victory is a message to anyone who tries to disrespect us: You must understand that respect for our honor and sovereignty is not
negotiable.”

The trial

Potgieter and Huxham went on trial in June.

By now the alleged cocaine, which authorities had previously displayed loose in black bags, was presented as trial evidence wrapped in half-a-dozen tight white bundles, according to a complaint filed to the United Nations Working Group on Arbitrary Detentions by the men’s lawyer.

Prosecutors never explained how the police found the alleged drugs, not having seized Potgieter and Huxham’s backpacks. Nor did they present any evidence that the powder was, in fact, cocaine, despite defense requests that the substance be tested, according to the appeal filed by the defendants.

Nevertheless, the court found the South Africans guilty: “After several months of investigation, the Criminal Police came to the conclusion and without any mistake, that
the ANDA CHINA hotel was the place where the accused kept said product (Cocaine) for its later sale,” the judges wrote.

The court even stated, inaccurately, that the defendants had confessed. Each man was sentenced to 12 years in prison, $5 million in compensatory damages to be paid to the government, an unexplained $2,500 fine, and court costs.

“Equatorial Guinea guarantees the well-being of all the expatriates working in the country, but we’re also obliged to adhere to international norms against drug trafficking,” says Obama Ondo, the ambassador.

Diplomats and the men’s lawyers and families, however, complained the sentences far exceeded the three-year maximum set by Equatorial Guinean law, and that the enormous fines seemed less about compensating the state for damage inflicted by a scourge of drugs and more about compensating Teddy Nguema Obiang for the seizure of his villas and the
Blue Shadow.

“The evidence presented at trial on the drug charge was not credible, and the penalty imposed was inconsistent with Equatorial Guinean law,” says the U.S. official.

Stuck in prison

Potgieter and Huxham have now spent more than a year in prison and appear in courtroom photos to have lost a great deal of weight. They have been allowed a handful
of visits from South African and U.K. diplomats, and five family phone calls between them. In one, Huxham proposed to his longtime girlfriend; she accepted.

The men’s families praise SBM for exerting pressure to get Potgieter and Huxham freed. But they say Exxon and Chevron haven’t thrown their weight around on the men’s
behalf.

An Exxon spokeswoman says the company supports SBM’s efforts, but adds that “these are sensitive matters, and we don’t comment on details involving employees of other
companies.”

A senior Chevron executive joined a recent call with family members. Chevron’s local subsidiary “remains committed to the rule of law and ethical business standards in its operations and to its partnership with the Republic of Equatorial Guinea to develop its energy resources for the benefit of its people,” a spokeswoman says.

Foreign companies are wary of provoking the Obiangs. In addition to the money they have at stake in Equatorial Guinea, they have other employees in the country, as
vulnerable to arbitrary arrest as were the South Africans. And Exxon, its Zafiro oil field’s production tapering off, is navigating its own exit from the country.

The families also fault the South African government’s response. A top South African diplomat, Zane Dangor, told Potgieter’s wife the government is hamstrung because an Equatorial Guinean court had convicted the men. But South Africa’s foreign minister is leading a delegation to Equatorial Guinea this week in hopes of negotiating the oil workers’ release, Dangor told The Wall Street Journal.

Obama Ondo says the men’s conviction “has nothing to do with a private case the vice president might have in South Africa.” But, he hints, maybe there’s a deal to be struck. “Diplomatic lines of communication are open to resolve this case,” the ambassador says. Daniel van Rensburg’s adviser, Errol Eldson suspects Nguema Obiang would free the men if he got his villas back. “But where would that leave Daniel?”

Write to Michael M. Phillips at Michael.Phillips@wsj.com (END) Dow Jones Newswires

May 06, 2024 00:01 ET (06:01 GMT)