Brittania-U drags Chevron to court over oil bloc deal

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Chevron CorporationThe controversial Chevron oil bloc bid round for which indigenous oil prospecting company, Brittania-U, reportedly made the highest winning bid of $1.6 billion got messier yesterday with the local firm suing the multinational oil company for breach of the bid arrangement.

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The defendants in the suit were listed as Chevron Nigeria Limited; Chevron USA, inc; BNP Paribas Securities Corp; Mr. Hermant Patel and Seplat Petroleum Development Company Limited, all of which are involved in the transaction of the assets Oil Mining Lease OMLs 52,53, and 55.

According to information from sources close to the Nigerian National Petroleum Corporation (NNPC) the court injunction has also been served NNPC

management to put it on notice.

The copy that was sent to the organisation by Ricky Tarfa & Co., the lawyer to Brittania-U said “Our client was the successful bidder for the 40% interest of Chevron Nigeria Limited, in OMLs 52, 53 and 55 by a private bid that was conducted between June, 2013 and 14th November,

2013. On 14th November, 2013 final terms of the acquisition were agreed between our client and Chevron leaving only the execution and exchange of the Sales and Purchase Agreement between the parties before perfection of necessary regulatory compliances post agreement.”

The letter, BusinessDay learnt has also put NNPC on notice that at the expiration of one month from the date of receipt of the statutory notice, its client shall commence steps to proceed against NNPC by praying to join NNPC as a co-defendant, along with the existing

defendants in the suit.

The principal claim according to Ricky Tarfa & Co. is to validate the sale of the three (3) OMLs to its client as against all the defendants and damages for the injury occasioned by failure of all affected and liable adverse parties in wrongfully interfering with the process of

formalising and upholding the contract entered into between Chevron and its client, in respect of the three OMLs.

“For the avoidance of doubt, the reliefs to be sought against NNPC shall include but may not be limited to perpetual injunction restraining NNPC from assisting, interfering or wrongfully procuring the breach of the contract between its client and Chevron in respect

of the OMLs or permitting a third party to procure a derogation from the contract to the business and reputational prejudice of its client.

For the avoidance of doubt, details of the reliefs which shall be extended to NNPC if leave to sue and join it as a co-defendant is granted are reproduced below:

“(1) A declaration that the final binding offer made by the plaintiff to the 1st defendant on 14th November, 2013 at the invitation of the 1st defendant in the sum of one billion and fifteen million US dollars

(US$1,015,000.00), for acquisition of the 40% participating interest of Chevron Nigeria Limited in oil mining leases 52,53 and 56 has been accepted by the 1st defendant by its conduct, oral and written representation made thereafter on which the plaintiff relied and acted to its detriment, and that by provision of the irrevocable standby letter of credit for the sum of two hundred and fifty million (US$250) opened in favour of the 1st defendant, to remain in force until 14th September 2014, as part payment; and further provision of firm letter of commitment by the plaintiffs bankers for payment of the balance of 765 million US dollars demanded for and duly furnished to the 1st defendant on 15th November, 2013, the parties have entered

into binding contract for the acquisition of the OMLs 52,53 and 55 by the plaintiff from the 1st defendant for valuable consideration.

BusinessDay learnt that the decision to go to court by Britannia –U followed recent meetings the company had with Chevron, the last of which was on November 14 at the instance of Ali Moshiri, president, Chevron Corporation, who directed the Brittania-U management to come with their bankers, namely First Bank,Diamond Bank and Ecobank, as well as their lawyers and firm Board commitment letters showing that the banks are ready to fund Brittania-U’s bid amount.

Sources close to the transaction had earlier told BusinessDay that these firm Board commitment letters, which are widely regarded as good as cash in this kinds of transactions, had not been part of the bid process published by Chevron.

Although Chevron was said to have openly acknowledged Brittania-U as having submitted the highest bid based on the process information memorandum which stated that Chevron will sell the blocs as a composite bid or collective to the highest single bidder and not on individual bloc basis, the oil major is alleged to be now claiming differently.

Chevron also failed to provide a formal letter to that effect, but kept prodding Brittania-U to provide bank Board firm commitment letter.

Babatunde Akinsola
Babatunde Akinsolahttps://naija247news.com
Babatunde Akinsola is aNaija247news' Southwest editor. He's based in Lagos and writes on the Yoruba Nation political issues, news and investigative reports

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