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Business

Federal High Court freezes Shell accounts

A Federal Court in Lagos has issued an injunction barring Shell from withdrawing money from its bank accounts.

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Dutch court orders Shell Nigeria to pay compensation for oil spill

Ahead of the Aiteo lawsuit, the Federal Court in Lagos has issued an injunction barring Shell Petroleum Development Co Limited (SPDC) from withdrawing money at its 20 local banks until it ring-fences all the potential damages.

Aiteo Eastern E&P, an oil major, is seeking about $4 billion in total over alleged problems with the Nembe Creek Trunk Line (NCTL) pipeline it bought from SPDC in 2015 and over claims that Shell undercounted its oil exports.

As reported by Reuters, the court documents sighted by them show that Aiteo is seeking compensation over what it described as the poor condition of the pipeline and associated lost oil sales.

In addition, the court documents show that Aiteo is also accusing SPDC of deliberate improper metering of its oil exports from the Bonny Light terminal.

A spokesman for SPDC has described the allegations as “factually incorrect”.

SPDC is working to secure an expeditious discharge of the freezing injunction, which we believe was obtained by Aiteo without any valid basis,” the Spokesman said.

The officials of Aiteo declined to make any comments on the ongoing legal case.

What you should know

  • The lawsuit is the latest in a string of legal headaches for SPDC.
  • Aiteo is seeking $2.7 billion over the pipeline deal plus $1.28 billion for lost oil sales.
  • Just last week, a British court cleared the way for local communities to sue the company over oil spills in Nigeria.
  • Last month, SPDC lost a case brought in the Netherlands by Nigerian farmers and fisherman over pollution claims.

Johnson is a risk management professional and banker with unbridled passion for research and writing. He graduated top of the class with B.sc Statistics from the University of Nigeria and an MBA degree with specialization in Finance from Ambrose Alli University Ekpoma, with fellowships from the Association of Enterprise Risk management Professionals(FERP) and Institute of Credit and Collections management of Nigeria (FICCM). He is currently pursuing his PhD in Risk management in one of the top-rated universities in the UK.

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