Nigeria court asks Seplat Petroleum to issue $20 mln bond guarantee, orders unsealing of oil firm’s offices
The Lagos division of the Court of Appeal has asked Seplat Petroleum Development Company to raise a bond of $20 million as part of the conditions to unseal the corporate offices of the oil firm.
In its ruling on an appeal filed against the interim order issued by a Federal High Court sealing the corporate offices of the oil firm, the Appeal Court ordered Seplat Petroleum to issue the bond in the name of the court’s Chief Registrar, an order the company’s counsel Etigwe Uwa said had been complied with.
The Appeal Court, therefore, lifted the interim order issued by a Federal High Court sealing up Seplat Petroleum corporate offices.
The Federal High Court had on December 24, 2020, granting injunctions that, among others, resulted in the sealing of its corporate offices of Seplat in Lagos over loans which Cardinal Drilling Services Limited allegedly owed Access Bank Plc.
In suspending the order, the Appeal Court noted that Seplat supplied gas to three power plants that generate almost 40 percent of power supply in Nigeria and that it would not be able to deliver this service if the order was not suspended.
The court rejected Access Bank’s argument that suspending the interim order would amount to dabbling into the substantive issues that ought to be determined while hearing the main appeal.
“The fear and anxiety expressed by the 1st Respondent (Access Bank) appeared unfounded. It would also not amount to hearing the substantive suit,” Justice Ikyegh held.
He further held that the Supreme Court had established the principle that in appropriate cases, the discretion of the court should be exercised in favour of the party that would suffer if the interim order was not lifted.
“The Supreme Court has held that where machines and workers would be rendered useless, the court would intervene.
“Disruption of business should be considered in the issue of balance of convenience. The court will exercise its discretion in suspending the injunction.
“Practical approach should be adopted and not do injustice to any of the parties.
“Where considerable hardship will be done to a party, the court will intervene by suspending the injunction or stay it.
“I found substance in the argument. The injunction restraining the appellant from operating is hereby suspended.
“Order on its accounts are also lifted pending the determination of the appeal,” the Judge ruled.
In an affidavit deposed in support of the application, Seplat maintained that it had no connection whatsoever with the loan in issue or the debenture with which it was secured and that the high court was wrong to have issued the order sealing its premises.
The company explained that the loan agreements evidenced by letters of offer of credit facility were all between Diamond Bank Plc. (now Access Bank Plc.) and Cardinal Drilling Services Limited, while the three Deeds of Debenture to the loan were over specific and fixed assets of Cardinal Drilling viz four Drilling Rigs set out in the schedules of the three Deeds of Debenture.