Capital Oil re-opens, AMCON to oversee its finances

24 November 2012, Sweetcrude, Lagos – ASSET Asset Management Corporation of Nigeria, AMCON, has stepped into embattled Capital Oil and Gas Limited, taking over its financial operations.

The move came after AMCON management met Friday with Mr Ifeanyi Patrick Ubah with both parties agreeing to opening of Capital Oil depot in Lagos and AMCON overseeing its finances.

Last week, a Federal High Court in Abuja froze Capital Oil assets and odered a shut down of its operations.

Under the new arrangement, AMCON would be moving its personnel into the depot to monitor the finances and ensure it is diverted to other uses.

Capital Oil will keep certain percentage of the finances to meet the operating costs, while AMCON will retain certain percentage to offset Capital Oil’s indebtedness to AMCON.

Ubah and Capital Oil are indebted to AMCON to the tune of N48.014 billion.

The decision to re-open Capital Oil may have been informed by the need to stem the current fuel crisis in the country, which worsened over the past few days due to the closure of the depot.

Capital Oil is believed to account for about 35 per cent of Nigeria’s total fuel storage and it is feared that continued shutdown of its operations would impact heavily on availability of petroleum products nationwide, especially given the existing scarcity in the country.

Prior to the Abuja court order for a shutdown of Capital Oil operations, a London High Court had granted an injunction freezing all assets of Ubah and his company worldwide.

The order by the UK court was granted sequel to an application by Access Bank Plc to preserve its assets pending the determination of the suit brought before it by the bank.

In its response to an ex-parte order for the temporary forfeiture of its asset, which was obtained by AMCON, Capital Oil last week shut down its depot and warned that the immediate shut down of operations would affect supply of petroleum products around the country.

The company said in a statement that Nigerians would be worse off for its predicament, in view of the strategic importance of the company to product distribution in the country, as its storage facilities account for 35 per cent of petrol used in the country.

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