Court unfreezes firm’s accounts over suppression of facts

Following the discovery of suppression of material facts and deliberate falsehood by Eurafric Energy, a Federal High Court, Lagos has vacated a freezing order it gave in its favour.

The court had granted the order freezing bank accounts belonging to an oil firm and its parent company, Petralon 54 Limited and Petralon Energy Limited, wherever domiciled in 18 banks across the country.

Delivering a ruling in a motion filed by the company, praying the court to unfreeze the unjustly frozen accounts on October 15, 2022, the trial judge, Justice Daniel Osiagor, held that the court was misled to grant an order freezing the company’s accounts.

After considering Petralon 54’s affidavit in response to Eurafric’s counter-affidavit dated October 12, 2022, and the address in support of the motion to set aside the ex parte orders, the court held that Eurafric had grossly misinformed it and caused it to act in error.

Eurafric Energy had approached the court, praying it to bar operations of and transactions on the bank accounts belonging to Petralon 54, its parent company, Petralon Energy, and an unrelated company, Tako E&P Solution, on the ground that the three oil companies did not declare the total quantity of crude sold, the amount it was sold and the royalty paid to the government in a Federal Government agency transaction.

Justice Osiagor, in his consolidated judgment, ruled that Exhibit Volte Face F exhibited in the plaintiff’s counter affidavit and Exhibit G exhibited in the defendant’s counter affidavit clearly indicated that the plaintiff (Eurafric Energy) gave consent for a loan of $2.2 million to be obtained, thereby making it a party to the debt repayment efforts to the holding bank, which the funds it sought to freeze pertained to, but this fact was not disclosed to the court before the restraining order on the defendant’s accounts.

The banks affected by the order of court include Access Bank Plc; Ecobank Bank Plc; First Bank of Nigeria Plc; First City Monument Bank Plc; Guaranty Trust Bank Plc; Jaiz Bank Plc; Keystone Bank Plc; Polaris Bank Plc; Stanbic IBTC Bank Plc and Zenith Bank Plc.

The others are Globus Bank Plc; Titan Bank Plc; Providus Bank Plc; Fidelity Bank Plc; Standard Chartered Bank Plc; Sterling Bank Plc; Union Bank of Nigeria Plc and United Bank for Africa Plc.

Findings revealed that until June 28, 2022, when Petralon 54 became the sole operator of the Dawes Island Field, having being granted Petroleum Prospecting Licence No. 259 (PPL 259) by the Federal Government in accordance with the Petroleum Industry Act, 2021, the plaintiff (Eurafric Energy), Petralon 54 and Tako E&P Solutions were joint venture (JV) partners.

The JV arrangement covered operation at the Dawes Island Marginal Field initially awarded to the plaintiff (Eurafric Energy), which was revoked on the grounds of operational ineptitude, poor management and asset abandonment for more than 14 years, resulting in loss of revenue to the Federal Government and being inimical/ adversely impacting the development of Okrika communities, River State, where the asset is situated.

Earlier in the transaction, the JV had secured a loan of $2.2 million from Access Bank for operational activities, with a crude sale proceeds domiciliation agreement with the bank to offset the JV indebtedness.

In its alleged misleading presentations to the court, Eurafric Energy was accused of concealing the knowledge of the loan, which exhibit Volte Face F in its own counter affidavit and defendant’s exhibit ‘G’ in its counter process proved beyond a reasonable doubt.