A Review of the Nigerian Energy Industry

Court strikes out Agip’s objection against Arco

15 June 2015, Abuja – Justice Lambo Akanbi of the Federal High Court in Port Harcourt has struck out the preliminary objection filed by the Nigerian Agip Oil Company Limited to challenge the suit instituted by an indigenous oil servicing firm,  Arco Group Plc.

ArcoJustice Akanbi in his ruling said the preliminary objection was incompetent because Agip did not file any memorandum of appearance before filing its notice of preliminary objection.

The judge said one the consequences of such an action was that Agip took the step in violation of the provisions of Order 29, Rules 1 and 2 of the court’s rules.

He noted that the action of the defendant was fundamental.

Since it was likely going be Agip’s next line of argument, the judge then raised jurisdictional competence of the court to entertain Arco’s claim and advised parties in the suit to address the court accordingly on the adjourned date.

Arco had dragged Agip, Nigerian National Petroleum Corporation (NNPC), Conoco Philips Petroleum Nigeria Limited and the Nigeria Petroleum Investment Management Services (NAPIMS) before the court to determine whether in view of the provision of section 3 subsections (2) and (3) of the Nigerian Oil and Gas Industry Content Development Act, 2010, having demonstrated ownership of equipment, Nigerian personnel and capacity to execute the task of performing the contract for the maintenance service of rotating equipment at the Nigerian Agip Oil Company gas plants at OB/OB, Ebocha and Kwale, it is entitled, being a Nigerian company, to the exclusive right to be considered and granted such contract including any extension of its duration?

Justice Akanbi, while ruling on the ex-parte application brought by Arco, had on February 4 restrained Agip and its agents from awarding or taking any step to award to any person, company or firm except Arco any contract whether designated as interim, stop-gap for the maintenance of gas turbines or rotating equipment at Agip’s OB/OB, Ebocha and Kwale gas plant pending the hearing and determination of the motion on notice for the order of interlocutory injunction.

Since the defendants were alleged to be avoiding service of the court’s order, the court again ordered that they be served by substituted means through advertorial in two national newspapers, namely THISDAY and The Guardian.

It also ordered the Managing Directors of Agip and Plantgeria Company Limited, Mr. Insula Massimo and Mr. P. L. Carrodano to appear before him on Monday, April 27, to inform the court why they should not be committed to prison for disobeying the order of the court.

On the next adjourned date, Arco informed the court that Agip had disobeyed its orders, prompting it to file committal processes against the defendants.

This made Justice Akanbi to fix June 23 to hear the contempt charges filed against Agip. He therefore ordered the two chief executive officers to ensure that they are present in court on the said date to show cause why an order for their committal to prison should not be made.

Rather than show cause while they should not be committed to prison, Agip filed a preliminary objection to the suit, which the court has struck out.

In the substantive suit, Arco is also seeking the court to determine whether the persistent and deliberate refusal by Agip to give exclusive consideration to it in respect of the contract for the maintenance and service of rotating equipment machines at the defendant’s gas plants at OB/OB, Ebocha and Kwale and to grant an extension of such contract by way of an interim or stop-gap contract is not a violation of the spirit and letters of section 3 subsections (2) and (3) of the Nigerian Oil and Gas Industry Contract Development Act, 2010.

The firm is asking the court to determine whether in view of the provision of section 3 subsections (2) and (3) of the Nigerian Oil and Gas Industry Content Development Act, 2010, having demonstrated ownership of equipment, Nigerian personnel and capacity to execute the task of performing the contract for the maintenance service of rotating equipment at the Nigerian Agip Oil Company gas plants at OB/OB, Ebocha and Kwale, it is entitled, being a Nigerian company, to the exclusive right to be considered and granted such contract including any extension of its duration?

It is seeking a declaration that by virtue of section 3 subsections (2) and (3) of the Nigerian Oil and Gas Industry Content Development Act, 2010, having demonstrated ownership of equipment, Nigerian personnel and capacity to execute the task of performing the contract for the maintenance and servicing of the rotating equipment machines at the Nigerian Agip Oil Company gas plants at OB/OB, Ebocha and Kwale, it is entitled, being a Nigerian company, to the exclusive right to be considered and granted such contract including any extension of its duration.

The firm is further asking the court to declare that the persistent and deliberate refusal by the first defendant to give exclusive consideration to it in respect of the contract for the maintenance and  servicing of the rotating equipment machines at the Nigerian Agip Oil Company gas plants at OB/OB, Ebocha and Kwale, and to grant extension of the contract by way of an interim or a stop-gap contract, is a deliberate violation and sabotage of both the spirit and letter of section 3 subsections (2) and (3) of the Nigerian Oil and Gas Industry Content Development Act, 2010, and is, therefore, illegal, unlawful, ultra vires its powers under the law, null and void and of no effect whatsoever.

 

– This Day

In this article

Join the Conversation