The Federal High Court, Port Harcourt Judicial Division, has ordered the arrest of the entire cargo onboard the Floating Production Storage and Offloading (FPSO) Vessel Tamara Tokoni, located in Rivers State, linked to General Hydrocarbons Limited (GHL).
Justice E.A. Obile issued the ruling in an ex parte motion filed by First Bank of Nigeria Limited (FBN) on January 9, 2025, seen by Nairametrics.
FBN is insisting on a $19,752,304.84 bank guarantee and the payment of costs by GHL and others before they can tamper with or transact the crude oil products onboard the vessel.
The application aims to secure FBN’s financial claim against GHL, the cargo of crude oil onboard FPSO Tamara Tokoni, as well as the owners, operators, and master of the vessel, listed as the first to fourth defendants in the motion obtained by Nairametrics.
A bank guarantee is a promise by a bank to meet the liabilities of a business if it fails to fulfil its contractual obligations.
FBN’s Case
- According to an affidavit deposed by Temitayo Osundosumu, a staff member of FBN, a bank guarantee submitted by GHL and others is critical to securing FBN’s financial investments in GHL and debts allegedly owed to the financial institution by the oil and gas company.
The applicant’s lawyer, E.C. Unachukwu Esq., also urged the court to prevent GHL from wasting or diverting crude oil products.
He prayed for the following orders:
“An order arresting or attaching the entire cargo of crude oil onboard the Floating Production Storage and Offloading (FPSO) Vessel Tamara Tokoni, presently located in Rivers State or wherever it may be found within the jurisdiction of this Honourable Court, pending the provision of a satisfactory guarantee from a first-class Nigerian bank in the sum of $19,752,304.84 plus interest and costs by the defendants to secure the plaintiff’s claim herein, or until this Honourable Court otherwise orders.
“An order directing officers of the Nigerian Navy, NUPRC, NIMASA, Harbour Master of the Nigeria Ports Authority to render necessary assistance to the Admiralty Marshall of this Honourable Court in giving effect to the order of arrest of the the Cargo of Crude Oil on Board FPSO Tamara Tokoni in order to secure same and also take other steps including the provision of regular patrols and surveillance around her to prevent the GHL from dissipation until the Order of this Court have been compiled with in respect of the arrest of the 2nd defendant.”
- According to the enrolled order, the court considered the application and granted FBN’s request on January 9, 2025.
- Nairametrics gathers that the case has been adjourned to February 10, 2025, for mention.
- The court has cautioned all parties against attempting to remove or interfere with the crude oil without authorization.
- Law enforcement agents have been directed to detain the said cargo onboard the FPSO vessel and keep it under custody until further orders are issued.
- Nairametrics learns that the Nigerian Navy has taken over FPSO Tamara in compliance with the court order and there is currently no loading on the vessel.
- There are allegations by sources related to the development that GHL allegedly wants to continue taking the oil and divert the proceeds.
What You Should Know
This development deepens the legal battle between FBN and GHL, an oil and gas company owned by media mogul Nduka Obaigbena.
In recent days, there have been allegations and counter-allegations regarding the development of Oil Mining Lease (OML) 120.
- The loan dispute between GHL and FBN has escalated into multiple court cases and arbitration proceedings, some pending resolution.
- Nairametrics previously reported that the Federal High Court in Lagos issued several orders, including a Mareva injunction, to freeze assets and accounts linked to GHL, its affiliates, and prominent individuals, including Nduka Obaigbena.
- The court’s decision follows allegations of unpaid loans amounting to $225.8 million, owed to FBN.
- However, Obaigbena claims that GHL voluntarily rescued FBN from collapse in the past, emphasizing that their collaboration helped resolve FBN’s financial challenges while contributing to the discovery of crude oil in Nigeria.
- GHL has maintained that it is not indebted to FBN and asserts that it has acted within the confines of legally binding agreements.
The FPSO Tamara Tokoni is operated by Century Group Nigeria, a Nigerian energy infrastructure provider that owns and operates several floating production, storage, and offloading (FPSO) units.
More insights
The loan dispute between General Hydrocarbons Limited (GHL) and First Bank of Nigeria Limited (FBN) has escalated into a court battle following GHL’s alleged request for a fresh $53 million facility to finance the development of Oil Mining Lease (OML) 120.
- This is according to information gleaned from a leaked letter purportedly signed by Nduka Obaigbena as well as court documents seen by Nairametrics.
- Sources close to the matter informed Nairametrics that officials at First Bank have refused to honor the new loan request, citing concerns over GHL’s utilization of previous loans disbursed for the same project.
- This refusal, coupled with growing mistrust, culminated in a Mareva injunction court ruling that temporarily froze GHL’s assets across multiple financial institutions in favor of FBN’s outstanding debt claims.
- According to the leaked letter addressed to the Central Bank Governor (CBN), Yemi Cardoso, the conflict stems from an agreement between FBN and GHL initiated during the tenure of Oba Otudeko, the former Chairman of FBN Holdings Plc.
- In 2020, GHL entered into a partnership with FBN to develop OML 120 after FBN faced financial exposure from non-performing loans (NPLs) linked to Atlantic Energy.
- Information contained in the letter further reveals the partnership was designed to “revive” FBN’s books, with profits from OML 120 shared to offset the NPLs.
- The letter also claimed that the financing arrangement “helped” FBN “avoid” declaring a massive N302 billion loan loss provision in 2021.
- However, GHL now accuses FBN of reneging on its obligations, including delays in disbursements that led to significant financial and operational setbacks.
- While the facility was initially pre-approved, sources reveal that FBN declined to disburse the funds, citing issues with how GHL utilized previous loans.
- The bank also expressed reservations about further funding, insisting on structural changes in GHL’s management.
- Nairametrics also notes that the timing of the loan request coincided with a slew of board and management changes in First Bank and its parent company, FBN Holdings as the bank implemented several corporate restructurings and repositioning ahead of its recapitalization plans.
Several sources who spoke to Nairametrics suggest the timing is significant, adding that a change in the risk management framework of the bank may have contributed to the decline of the fresh facility demand of GHL.
Mediation efforts
- Nairametrics learned that mediators involved in resolving the dispute proposed a significant overhaul in GHL’s leadership, including appointing new Chief Executive Officers (CEOs) and Chief Financial Officers (CFOs).
- However, both parties have yet to agree on these terms, further complicating the resolution process.
- In addition to the managerial restructuring, FBN allegedly proposed the appointment of an Independent Asset Manager under a new Framework Agreement.
- GHL objected, describing the move as an attempt by FBN to take control of its assets, including OML 120, and replace GHL’s management team and operations.
