Obat Oil Losses N1.5B Subsidy Claim To Sterling Bank Over Alleged Unpaid Loan

* Source: iFiPortal

 

 

Story by Gbenga Ogunbufunmi

 

A Federal High Court, Lagos, has ordered the Federal Ministry of Finance and Debt Management Office (DMO) to pay all monies and other payment instruments amounting to N1. 558, 214, 525. 79 billion accrued to Obat Oil Petroleum Limited as subsidy claims to Sterling Bank Plc.

The Court also restrained Obat Oil and Petroleum Limited, its agents, privies and any other person on behalf of the oil company, from dealing in any monies, instruments, sovereign debt notes and promissory notes standing in the company’s accounts, records and whatsoever, held with the Federal Ministry of Finance and DMO, to the tune of N1. 558, 214, 525.79 billion.

The court further ordered the Finance Ministry and DMO to disclosed on oath the total sum of money, funds,Sovereign Debit Notes (SDNs) either processed or yet to processed within purview of Petroleum Subsidy Scheme in their custody or possession or that may come into their possession or custody belonging to Obat Oil and Petroleum Limited for further direction of the court.

The court presided over by Justice Nicholas Oweibo, gave the directives while ruling in a Mareva Order application to preserve the monies and other financial instruments as subsidy payment, due to Obat Oil and Petroleum Limited by the Federal Ministry of Finance and DMO, filed by Sterling Bank and Petrocam Trading Nigeria Limited by their lawyer, Gbenga Akinde -Peters of Temilolu Adamolekun Law firm.

The order, according to Justice Oweibo, will subsist till the determination of suit marked FHC/L/CS/1100/19, filed against Obat Oil and Petroleum Limited by Sterling Bank Plc and Petrocam Trading Nigeria Limited.

In urging the court to grant the Mareva Order, Sterling Bank Plc and Petrocam Trading Nigeria Limited, stated that the request for order was due to the failure of Obat Oil to pay back credit facilities of N1, 558, 214, 525. 79 billion granted to it.

The plaintiffs in a 59 paragraph-affidavit deposed to by Segun Omosola, a Litigation Officer in the office of Temilolu Adamolekun Laws firm, stated that the oil dealing firm after gotten allocation from the federal government through Petroleum Products Pricing Regulatory Agency (PPPRA), for importation of Premium Motor Spirit (PMS) approached Petrocam Trading Nigeria Limited to finance the importation of the Petroleum product. Consequently, Petrocam applied to the bank for enhancement of its existing trade facility to accommodate the transaction of Obat oil and Petroleum Limited.

The deponent states that having considered the application of Petrocam, the bank graciously granted the facility enhancement of $3 million USD, to accommodate the importation of the Petroleum product for Obat Oil through a joint venture transaction between the second plaintiff and Obat oil.

He also stated that for the proper management of the transaction, the second plaintiff and Obat oil entered into a service agreement dated April 25, 2014, which enable the second plaintiff to utilise its credit facility with the bank for the benefit of Obat oil.

It was further stated that Obat Oil opened a collection account with the bank to receive the receivables on the sales and all payments from the Federal Government and based on this agreement, Obat oil applied to the bank at different times, for opening Form M and establishment of Letters of Credits facilities under the umbrella of the second plaintiff’s credit line. And that based on that agreement, the bank secured approval of the Central Bank of Nigeria, Forms numbers, MF20140131150;   MF20140064023; MF20140149022; MF20140101134 and MF20140101100.

The deponent also stated that further to the confirmation of the authenticity and veracity of the letters of credits through its letter dated July 25 and 30 and November 25, 2014, to the Department of Petroleum Resources (DPR), the petroleum product was eventually delivered to Obat oil’s storage facility and sold to the public in line with the extant regulation from PPPRA under Petroleum Support Fund (PSF) scheme being regulated product.

The deponent further averred that contrary to the agreement of the parties and consternation of the plaintiffs, Obat Oil diverted all monies paid by the Federal Government representing accrued interest amongst others things over the transaction into accounts different from the collection account. The funds which ought to have been paid into collection account to reduce Petroleum’s indebtedness to the bank.

The deponent also stated that despite several reconciliation meetings, Obat Oil continues to perform acts to worsen the position of the collection account. And that upon investigation carried out by the plaintiffs, it was discovered that the funds were actually diverted for the personal use of the Obat Oil’s Alter Ego (owner).

The plaintiffs added  that despite several letters and agreement of parties, Obat Oil’s action now threaten the actualisation of receiving the receivables as the defendant is currently making plans and has in fact perfected the plans to divert the promissory notes/sovereign debt notes expected  to be received from the Federal Ministry of Finance and DMO. Adding that the ‘res’  of the suit is in real and complete danger by being completely dissipated any moment by Obat Oil and unless the court intervenes, the plaintiffs will definitely be left in the lurch.

Plaintiffs further stated that it would be in the overall interest of justice to grant the orders as the defendants (Federal Ministry of Finance and DMO) will not be prejudiced by granting same.

The hearing of the motion on notice on alleged indebtedness has been adjourned till August 15, 2119.

Be the first to comment on "Obat Oil Losses N1.5B Subsidy Claim To Sterling Bank Over Alleged Unpaid Loan"

Leave a comment

Your email address will not be published.


*