Neconde Energy has discontinued its case against the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which bordered on the alleged approval granted to banks to disrupt and interfere with operations in the Nigerian onshore Oil Mining Lease (OML) 42 based on an alleged loan.
The notice of discontinuance, seen by Nairametrics, was announced before Justice Umar Mohammed by Neconde’s lawyer, M. Ogwuche, on Tuesday.
Neconde, White Dove Shipping Company Limited, and four other plaintiffs dragged the NUPRC, four commercial banks, African Import-Export Bank (Afreximbank), and three other companies before the court.
The key issue raised by Neconde is whether the NUPRC can, via its letter dated October 15, 2025, with Reference No. NUPRC/LD/CPL/2839/Vol. 2/2025/94, allows agents of any charge holder to take over or disrupt the operations of assets in the OML 42 Joint Venture, of which the Federal Government of Nigeria holds a 55% stake and is the operator
- “When the assets covered by the first charge held by the 2nd–9th defendants have not crystallised and are still running.”
A first charge holder is a lender with the highest priority claim on a borrower’s asset following a loan agreement.
What they are saying
At the resumed proceedings, Ogwuche informed the court of the company’s notice of discontinuance against the NUPRC.
- According to the lawyer, “We (Neconde and other plaintiffs) found it pertinent to discontinue against the NUPRC at this time after a careful review of the whole matter.”
Responding, NUPRC counsel, Wale Balogun (SAN), confirmed being served with the plaintiffs’ notice of discontinuance (dated February 17, 2026) against the Commission.
- “We have no objection,” he said, but called for an award of N5 million in costs, having filed a preliminary objection against Neconde’s case.
- “After hearing from both parties, Justice Umar ruled that, following the notice of discontinuance by Neconde, “the name of the first defendant (NUPRC) is struck out from this action.”
The judge awarded a cost of N500,000 against Neconde.
Subsequently, counsel for the commercial banks, Victor Ogude (SAN), drew the court’s attention to his preliminary objection seeking to dismiss the suit.
However, the judge said Neconde and the other plaintiffs should be given time to respond to the preliminary objection.
The judge consequently adjourned the case to June 8, 2026, for hearing and for the plaintiffs to respond to the preliminary objection of the commercial banks.
Backstory
The plaintiffs had sought a perpetual injunction restraining the NUPRC and the respective banks from taking possession of Neconde’s assets on the basis of any credit facilities “under the first charge or any other charge, insofar as the charge on the facilities has not crystallised.”
They contended that the NUPRC’s letter was issued in error, as the facility between Neconde and any of the banks in this suit has allegedly not crystallised and remains ongoing.
The plaintiffs further alleged that the banks had threatened to seize, take over, possess, and dispose of their properties based on Nestoil’s liabilities to them as lenders, necessitating the court’s intervention.
NUPRC’s lead counsel, Ahmed Raji (SAN), filed a response, maintaining that the Commission is a statutory corporation created by the Petroleum Industry Act (PIA) 2021 and charged with the responsibility of regulating the upstream sector of the petroleum industry in Nigeria.
The Commission urged the court to hold that, based on the PIA, the action commenced by the plaintiffs is premature due to the failure to issue and serve the mandatory one-month pre-action notice on the NUPRC.
The Commission urged the court to dismiss or strike out the case in the interest of justice.
What you should know
Neconde Energy Limited was incorporated in November 2010 as a private oil and gas company and began full operations in late 2011 following the joint venture acquisition of OML 42 from Shell Petroleum Development Company (SPDC).
Neconde owns a 45% stake, while the Nigerian Petroleum Development Company (NPDC) owns 55%.
- Neconde is controlled by Nestoil Limited, a subsidiary of the Obijackson Group, owned by Ernest Azudialu.
- Nestoil, Neconde, and others are engaged in pending multi-million-naira alleged loan cases involving FBNQuest.
- Beyond the Abuja proceedings, the dispute has also played out in Lagos, with significant enforcement actions taken against Nestoil and its affiliates at the time.
- Recall that armed police officers sealed Nestoil’s headquarters in Victoria Island, Lagos, following a Federal High Court order freezing the company’s assets, bank accounts, and shares.
- The action was linked to alleged debts of $1.01 billion and N430 billion owed to FBNQuest Merchant Bank Limited and First Trustees Limited.
- The enforcement followed a Mareva injunction granted on October 22, 2025, authorising the takeover of assets belonging to Nestoil, Neconde, and their promoters across more than 20 financial institutions.
- That order was later set aside by another Federal High Court judge, prompting an appeal that resulted in an interim injunction restraining Nestoil from interfering with the receiver/manager’s duties.
In April this year, the Supreme Court set aside a Court of Appeal decision that disqualified senior lawyers Wole Olanipekun and Muiz Banire from appearing for Nestoil Limited and Neconde Energy Limited in a $2 billion dispute over a contested receivership.
The loan dispute is still pending.
