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Court Restores Abigborodo, Hely Creek Fields To Transnational Energy

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A Federal High Court in Abuja has set aside the purported reversal of the consent given by the Federal Government for the farm-out agreement between Chevron and Transnational Energy Limited (TEL) on the Abigborodo and Hely Creeks marginal fields in the Oil Mining Lease (OML) 49.
The court, in a judgment by Justice Taiwo Taiwo, upheld the plaintiffs’ claims and granted all the reliefs sought, including an award of $20million in damages against the defendants, who are all Federal Government’s agents.
The judgment was on a suit, marked: FHC/ABJ/CS/1067/2020, filed by Transnational Energy Limited (TEL) and Bresson A. S. Nigeria Limited.
Defendants were Minister of Petroleum Resources, Minister of State, Petroleum Resources, Department of Petroleum Resources, National Petroleum Investment and Management Services (NAPIMS) and the Attorney General of the Federation.
The plaintiffs, through their lawyer, Dr. Sijuade Kayode, claimed that a farm-out agreement over the two marginal fields was concluded between TEL and the joint venture operators, Chevron Nigeria Limited in 2017 for amongst others purposes, to provide feedstock to a gas-to-power project developed by TEL and its partners, which started in 2012.
They stated that the Department of Petroleum Resources (DPR), in a letter dated 20th February, 2017, conveyed a letter of ministerial consent by the Minister of Petroleum Resources approving the farm-out and its terms.
The plaintiffs added that the DPR, in its said letter, equally directed TEL to pay a prescribed premium to Federal Government, after which the farm-out will become effective, a directive TEL complied with by paying the prescribed fee of $639,820.65.
Rather than allow the plaintiffs enjoy the benefits of the agreement after the FG acknowledge receiving TEL’s payment, the then Chief of Staff to President Muhammadu Buhari, the late Abba Kyari wrote a memo, purporting to revoke the earlier ministerial consent, claiming to have acted on the instruction of the President.
They added that the DPR, without any notice to the farmee (TEL) put the two fields in the 2020 marginal fields basket, even though the fields were not part of the original 57 of fields approved for the bid round, a decision TEL and its sister company in the power business (Bresson A.S. Nigeria Limited) challenged by filing the suit.
The plaintiffs exhibited their audited accounts, business plan and financial model which showed that both plaintiffs had jointly expended $22,718,000.00 on the development of the gas and power side of the project.
They also exhibited their financial models in arguing that they have lost over $164million due to the actions of the defendants, while Federal Government may have equally lost over $68million in royalty and taxes not earned as a result of the actions of the defendants.
They plaintiffs asserted that their gas-to-power project elicited a massive international cooperation spanning over 15 countries and involving over 100 international experts.
“As a matter of fact, the Hungarian Exim Bank went to parliament to amend its legislation in order to raise her scope of participation in the power side of the projects,” they said.
Justice Taiwo, in the judgment delivered on October 18, 2020, a copy of which was made available on Friday, held that the defendants failed to supply counter evidence and arguments to disprove the plaintiffs’ claims.
The judge noted: “One thing that is very clear and undeniably so, is that the averments of the plaintiffs, from the inception of the meetings and correspondences between the plaintiffs, Chevron Nig Ltd, the third defendant (DPR), NNPC and NAPIMS on the farming out by Chevron Nigria of the Hely Creek and Abigborodo marginal fields within OML 49 were not denied.
“From the preponderance of the facts and documents attached to the affidavits of the plaintiffs in support of the application, I find and I hold that the plaintiffs have proved that they are entitled to the declaratory reliefs being sought,” the judge said.
Justice Taiwo, who upheld NAPIMS’ claim that it was not a juristic person and excluded it as a party, expressed displeasure at the conduct of the defendants in relation to issues leading to the dispute and asked governments and their agencies to always abide by contractual agreements duly entered.
He wondered why the the defendants turned around to dispute the presidential consent given for the farm out agreement between TEL and Chevron after the Ministry of Petroleum accepted the $639,820.65 the plaintiffs paid to the FG and which payment the ministry acknowledged.
The judge added: “The defendants cannot be allowed to resile from their obligation under the contract or agreement where they have benefited. Money was paid into the coffers of the Federal Government of Nigeria by the fist plaintiff (TEL).”
Justice Taiwo held that neither the then Chief of Staff to the President nor NAPTIMS and DPR has the power to issue any letter reversing the farming out agreement as they purported to have done.
“Governments and their officials must not, without legal reasons, terminate contracts at will and without recourse to their conscience, where as, in this case, as held above, that the plaintiffs have put in substantial efforts and expended monies in the project.
“It is even bad that the defendants have not offered to refund the money paid by the first plaintiff in this matter. The purported revocation, if I may use the word, leaves one to think that there are facts suppressed by the defendants,” he said.
The judge proceeded to, among others, affirmed the consent already granted TEL in relation to the farm out agreement, validated the payment made by the company as approved premium for the consent and ordered the defendants to take all necessary steps to allow the plaintiffs unhindered access and possession of the said Hely Creek and Abigborodo fields.
It was learnt from the court’s registry that one of the defendants has applied for stay of execution of the judgment upon filing a notice of appeal.
But, the plaintiffs, it was gathered, are favourably disposed to an amicable resolution of the dispute in view of the financial costs to both parties, and particularly its impact on the main aim of the agreement, which was to provide gas for power plants.

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NSCDC Parades Five Suspects Over 24,000 Litres Of AGO 

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The Nigeria Security and Civil Defence Corps (NSCDC) last Friday paraded five suspected oil thieves caught with over 24,000 litres of illegally refined Automotive Gasoline Oil (AGO) concealed in sack bags in Rivers State.
Rivers State Commandant of NSCDC, Michael Besong Ogar, while parading the suspects, reiterated that there was no room for illegal oil bunkering activities in Rivers State, warning that perpetrators would be smoked out of their hideouts.
Ogar said the newly-reconstituted anti-vandal team has made successes in the relentless war against vandalism of oil pipelines and illegal dealings in petroleum products through massive arrests and subsequent prosecution of cases in the court.
“The Commandant General, Ahmed Abubakar Audi, has promised that in a short while there would be a drastic reduction and possible eradication of illegal dealings in petroleum products across the nation
“Our major task is to massively arrest oil pipelines vandals and their sponsors as we take the Anti-vandalism war to the enemies’ domain.
“The nation is losing millions of dollars per barrel due to the increase in pipelines vandalism and illegal oil bunkering, but I can assure you that this menace would be a thing of the past because we are fully committed to the mandate of the Corps’ in safeguarding all critical national assets and infrastructures.
“The suspects will be charged for contravening the Anti-sabotage Act, the Petroleum Act and the Miscellaneous offences Act 2004, laws of the Federation.
“They are: Ifegbu Uche ‘m’ aged 42years, Obinna Ogbonna ‘M’ 42years, Emmanuel Smart ‘m’ 19 years, Lawrence Gibson ‘m’ 35years, and Emeka Desmond ‘m’ 35years, who were arrested while conveying about 24,000 litres of illegally refined AGO concealed in sack bags and carefully packed in a Toyota Sequoia with plate number AbujaGWA386GVA; a Volkswagen Bus with Registration Number: Lagos APP 831 XX, which was intercepted at Abuloma Community in Port Harcourt, a Truck DA1700 with number plate KadunaXE653KA impounded at Abonnema Wharf, and a Ford E- 250 intercepted in Etche respectfully.
“We also intercepted and impounded another short white Mercedes truck with unquantified litres of illegally refined AGO along Ozuoba-Rumuigbo axis in Obio/Akpor LGA, Port Harcourt Rivers State.
“We are very excited that the court has resumed session as the suspects would definitely have their time in Court while application for forfeitures of the products and mode of conveyance would be made and proceeds be remitted in the Federal Government coffers,” NSCDC said.

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Eni Decries Production Loss From Bayelsa Gas Pipeline Explosion 

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Eni, the Italian parent company to the Nigerian Agip Oil Company (NAOC), has said the impact of the Ogboinbiri/OB-OB gas pipeline explosion on gas output was significant.
Production data from NAOC shows that the incident cut Agip’s gas exports by 5million standard cubic meters per day.
Media Relations Manager, in charge of African Operations at Eni, Mr Domenico Spins, said the gas leak has been brought under control.
Spins in a statement announced that the incident was caused by sabotage and third-party interference.
“Eni confirms that a third party’s interference hacksaw cut caused a gas leak at the Ogbainbiri-Ob/Ob gas pipeline.
“The line is depressurised and is currently being repaired. Production losses due to the shutdown are important,” Eni stated.
The Director-General of the National Oil Spills Detection and Response Agency (NOSDRA), Dr Idris Musa, who confirmed the pipeline blast, said the agency would lead an investigation into the incident as soon as it is safe to do so.
NOSDRA had also directed NAOC to shut down the oil and gas wells feeding the breached pipeline to extinguish the pressure and pave the way for a Joint Investigative Visit.

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FG Confiscates 20m Litres Of Illegally Refined AGO

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The Federal Government says the continued efforts by security agencies has led to the confiscation of over 20.2million litres of illegally refined Automotive Gasolme Oil (AGO), otherwise known as diesel.
Minister of Information and Culture, Lai Mohammed, disclosed this in Port Harcourt while carrying out an aerial survey of illegal refinery sites and hotspots along the Nembe Creek Trunk Line and the Trans-Niger Pipelines’ right of way on Friday.
Mohammed said over 210 suspects have been arrested in its efforts to combat crude oil theft in the Niger Delta region, lamenting that the activities of vandals and economic saboteurs have severely impacted the country’s crude oil production.
The Minister said over 461,000 litres of Premium Motor Spirit, 843,000 litres of Dual-Purpose Kerosene, and 383,000 barrels of crude oil have also been confiscated.
He said an additional 365 illegal refining sites were destroyed, with about 1,054 refining ovens, 1,210 metal storage tanks, 838 dugout pits, and 346 reservoirs also destroyed.
“Since the post-covid pandemic recovery of crude oil prices, Nigeria has been unable to meet its OPEC Production quota, hurting the Nigerian economy.
“Due to the nefarious activities of vandals, Nigeria has been losing out on producing approximately 700,000 Barrels of oil daily. This volume is split between crude stolen and production deferment (shut-ins) due to legitimate fear of losing substantial volumes in transit.
“Terminal receipts have persistently declined, leading to decisions such as the Force Majure declared at the Bonny Oil and Gas Terminal in March 2022,” he said.
The Minister also disclosed that the NNPC Ltd had set up a new security architecture to serve as a solid response to detect, deter, and respond to the activities of vandals.
He said the security architecture leveraged collaboration between the Upstream operators, Industry Regulators, Government Security Agencies, and Private Security Contractors.
He further said NNPC Ltd.’s Command and Control Centre has been set up for round-the-clock monitoring of petroleum operations and activities within the Nigerian Exclusive Economic Zone.
According to him, all vessel movements within the Nigerian Exclusive Economic Zone as well as all Ship-to-ship activities within the same zone are now monitored.

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