OML 42: NNPC Exploration MD, ED to Face Contempt Proceedings over  Disobedience

Wale Igbintate and Alex Enumah in Abuja

A local exploration and production company, Neconde Energy Limited, and a Nigerian oilfield services solutions company, Jones Creek Hydrocarbon have initiated a contempt proceeding against the Managing Director of  NNPC Exploration and Production Limited, Ali Muhammed Zaffah over alleged disobedience of the interim orders of court made on 29th of  March 2023.

Other contemnors are: the Executive Director, Production and Asset Management NNPC Exploration and Production Limited, Mustapha M. Yusufu and the Asset Manager OML 42 —NNPC E & P Limited, Zimako U. Ibe.

The applicants in their application brought pursuant to section 72 of the sheriffs and civil process Act CAP. S6 LFN 2004, filed by their lawyer, Uche Valentine Obi SAN, stated that the alleged contemnors flouted a subsisting court order made by Justice Daniel Osiagor of the Federal High Court, Lagos State,  restraining them from changing, altering or replacing the crude oil evacuation arrangement in place for OML 42 crude oil through pipelines from the asset to Keremor Manifold and vessel barging operation to Ugocha export Terminal by diverting or rechanneling the crude oil to Transforcados Fxport Terminal through the Transforcados pipelines or any other means pending the hearing and determination of the Motion on Notice for interlocutory injunction filed in suit number no: FHCL/CS/550 2023.

In their notice for committal proceedings, the applicants prayed the court for an order of committal to prison of the 1st, 2nd and 3rd Contemnors / Respondents having flouted, neglected and/or disobeyed the interim orders of the court made on 29th March 2023.

Justice Osiagor had granted “An Interim Order restraining the Defendant Respondent, whether acting by itself or through its servants, employees, officers, agents, privies, affiliates, subsidiaries, or any other person, howsoever described, from changing, altering or replacing the crude oil evacuation arrangement in place for OML 42 crude oil through pipelines from the asset to Keremo Manifold and vessel barging operation to Ugocha export Terminal by diverting or rechannelling the crude oil to Transforcados Export Terminal through the Transforcados pipelines or any other means pending the hearing and determination of the Motion on Notice for interlocutory injunction filed in the instant suit.

The court also restraining the Defendant/Respondent, whether acting by itself or through its servants, employees, officers, agents, privies, affiliates, subsidiaries, or any other person, howsoever described, from acting contrary to the terms enshrined in the binding Master Service Agreement (MSA) executed by it in favour of the 2”4 Plaintiff /Applicant granting the sole right to handle and evacuate the entire crude oil produced at OML 42 through Ugocha Export Terminal for a period of 15 years pending the hearing and determination of the Motion on Notice or interlocutory injunction filed in the instant suit.

In an 18-paragraph affidavit deposed to by one Olukayode Shobowale, a  Litigation Executive in Alliance Law Firm, Solicitors, he stated that  on 29th March, 2023, the court granted interim preservatory orders as stated above against the Defendant/Respondent including its officers, employees, servants, members, agents, assigns, privies, affiliates or any their person(s) howsoever described pending the determination of the pending motion on notice for interlocutory injunction filed in the suit.

He stated that ‘’On 30th March, 2023, at about 2.15pm, the certified true copies of the enrolled Orders of the Court together with the Plaintiffs/Applicants’ Motion on Notice for Interlocutory injunction, writ of Summons, Statement of Claim and other originating processes in the suit were served by the Bailiff of the Court, on the Defendants through its branch office located at 9th Floor, Foreshore Towers, Ikoyi, Lagos.

‘’As additional precaution and warning against violation of the court orders, the Plaintiffs’ counsel Mr. Uche Valentine Obi SAN, forwarded the aforesaid Court order with the endorsed receipt stamp of the Defendant / Respondent under a covering letter dated 30” March 2023 to the official email addresses of the 1st, 2nd, and 3rd Contemnors / Respondents amongst other persons.

‘’In the said letters strict waning of the legal consequences of flouting, disobeying and undermining the Court orders were explained with a call for respect and obedience to the Court orders.”

‘’However, despite the aforesaid service of the aforesaid Orders, at about 2.15pm on 30 March 2023 the 1st Defendant acting through the 1st – 3rd Defendants had convened a meeting at about 5pm on that same date presided over by the 2nd and 3rd Contemnor which was attended by its staff and workers of OML 42 concession and announced that the planned and threatened switch and diversion of OML 42 crude oil to Trans-forcados.

‘’In defiance of orders of this Court, the contemnors instructed its personnel, workmen drawn largely from the contractor, Pipeline Infrastructure Nigeria Limited, to continue with the injuncted works at the Keremor manifold with a view to concluding it expeditiously and achieved its planned switch and diversion of OML 42 Crude oil over the weekend so that it could claim that the injuncted acts had been already concluded and thus undermine the orders and foist a faith accompli on the Court and render its orders impotent and academic.

‘’Consequently, the injuncted and forbidden works had resumed at Keremor Manifold by the Defendant’s workmen and personnel in morning of Saturday 1, April 2023 through Sunday 2 April 2023 intensively under the directives of the Ist and  3rd Contemnors.

‘’When they drew the attention of the workmen and Defendant’s personnel to the subsisting Court orders they had explained that the 1st -3rd Defendants had directed resumption of works with an assurance that the Court orders must be vacated by their lawyers within a couple of days possibly before the return date of 21st  April 2023 fixed by the Court for further proceedings and that they had to continue with their work in the circumstances as there was a subtle threat to withhold their payments if they had stopped work in obedience to Court order.

He stated that upon reporting to the 1st Plaintiff’s Executive Management of the unsettling discovery, a helicopter overfly of the work site at Keremor Manifold was conducted in the morning of Sunday 2nd April 2023 which confirmed intensive works being executed by the workmen and personnel of the Defendant at the directives of the Defendant Management and as insisted on by the 1st – 3rd Contemnors / Respondent.”

‘’In further breach of the second Order No. 2, (or the third set of order) the Defendant acting through the Contemnors has failed, neglected, delayed, and withheld the timely and adequate presentation and follow up of the mandatory application for renewal of barging permit required to convey OML 42 crude oil from Kermor manifold to Ugocha Export Terminal which is part of its binding obligation as operator of OML 42 concession, which failure has now resulted to the expiration of barging permits on 31” March 2021 without any renewal and thereby disrupting crude evacuation, export, and continued production of more crude oil as the one produced are not emptied from the storage facilities to allow further production as at date.” 

“The implication of this development is not only in its contemptuous nature, it diminishes Nigeria’s oil production level as well as the much-needed revenue under the high oil price regime as huge revenues are lost daily by the production shut down.

‘’Upon the failure and refusal of the Defendant and its agents, officials, servants and privies to obey and/or comply with the orders of this Court, but instead to serially violate, disobey and disrespect same with a view to foisting a faith accompli on the Court, the Registrar of this Honourable Court had on 3rd April, 2023 issued three (3) Notices of Consequences of disobedience to order of Court (Form 48) to be served on the 1st  – 3rd  Contemnors respectively, which Form 48 were served on the 1st — 3rd Contemnors in their offices on 4th April 2023.

‘’The actions of the 1st-3rd Contemnors aforesaid, in the face of orders of this Court are intended to and capable of ridiculing the powers of this Court and foist a faith accompli on the Court and thereby rendering its orders a nugatory and the entire proceedings a mere academic exercise.

‘’It is in the best interest of justice that each of the Respondents Contemnors be committed to prison until they purge themselves of their contemptuous conduct.”