Court Asked to Wind-Up Oil Firm over $3.2m Debt

A Federal High Court sitting in Lagos has been asked to wind-up an oil firm, Emerald Energy Resources Limited, operator of OML 14 (formerly OPL 229), as a result of its inability to pay a debt of $3.2 million owed an oil and gas firm, ICS Energy Limited.

ICS Energy Limited, in suit No: FHC/L/ CP/1466/16 filed through its lawyer, Chief Emeka Okwuosa of the Chancery Associates, before Justice Ayotunde Faji, is asking the court for an order to wind up Emerald Energy Resources Limited in accordance with the provisions of the Companies and Allied Matters Act CAP C20 Laws of the Federation of Nigeria, 2004.

Specifically, ICS Energy Limited is asking the court to appoint liquidators to supervise the winding up process in order to pay the petitioner the sum of $3,288, 600 00 (three million, two hundred and eighty-eight thousand, six hundred U.S. Dollars), being the outstanding balance due to the petitioner for successfully sourcing and facilitating the payment by Diamond Bank PLC, of signature bonus of $11,000,000.00 (eleven million U.S Dollars) in respect of OPL 229, on behalf of the respondent, with interest at 22 percent per annum from September 16, 2015 until full payment and to others or creditor(s) as may be entitled by their respective claim(s).

The petition is supported with a 24 paragraphed affidavit, which stated that on January 12, 2000, the respondent engaged the services of the petitioner as a consultant to source and facilitate the payment of $11,000,000.00 signature bonus on OPL 229, on behalf of the respondent.

According to ICS Energy Limited, on August 10, 2001 Diamond Bank PLC granted and provided the $11,000,000.00. Thereafter, the respondent agreed to pay to the petitioner the sum of $8,000,000.00 which was later discounted to $4,000,000.00 by mutual agreement between both parties, culminating in the settlement agreement of June 20, 2004 between the petitioner and the respondent.

But the petitioner claimed that the respondent has thus far paid it the sum of $686,400.00 (six hundred and eighty six thousand, four hundred U. S. Dollars), while the balance is unpaid till date, as confirmed by the respondent in their inventory list of payment to the petitioner dated August 15, 2016.

Notwithstanding all entreaties and pleas, the respondent through its solicitors in a letter dated September 5, 2016 made a proposal to the petitioner, to make a good faith payment of $250,000,00(two hundred and fifty thousand U. S. Dollars) in five instalments hereunder stated towards and in part liquidation of its indebtedness of $3, 313,600.00 to the petitioner, under the settlement agreement of June 20, 2004, the respondent could only pay one instalment and has reneged on the other outstanding instalments due under the good faith payment of its total outstanding indebtedness of $3,288,600.00 to the petitioner.

However, the respondent in a notice of preliminary objection, asked the court for an order dismissing the suit in its entirety and any further order (s) the court may deem appropriate to make in the circumstances.

The respondent argued that no payment liability has arisen under the settlement agreement dated June 20, 2004 upon which the alleged debt of the $3,288,600 in the instant proceedings is hinged.

The respondent stated that the debt is disputed by it and indeed, the petitioner itself is not certain as to the amounts alleg- edly being owed, and that the letters dated September 16, 2015, July 1, 2016, July 4, 2016 and September 30, 2016 present conflicting sums without any one of them demanding the debt which is claimed in these proceedings.

Furthermore, the statutory notices are incompetent being contrary to section 409 (a) of the Companies and Allied Matters Act 1990 (as amended) and consequently, incapable of sustaining these proceedings.

> The petitioner however, in a counter affidavit in opposition to the respondent's notice of preliminary objection, stated that those letters do not contain conflicting sums with respect to the respondent's indebtedness to the petitioner, and that the sums were never challenged or controverted by the respondent.

It stated that the account reconciliation meeting of August 15, 2016 was to enable parties adequately reconcile their account to ascertain the respondent's exact outstanding indebtedness of $3,313, 600 to the petitioner, and both parties agreed on the said sums ($3, 313, 600) to be paid, which the respondent reneged, hence, the petition.

Justice Faji has fixed May 4, 2017 for hearing of the petition.