UPDATED: Court orders NNPC, Mobil to pay N82bn judgement debt to Akwa Ibom communities

UPDATED: Court orders NNPC, Mobil to pay N82bn judgement debt to Akwa Ibom communities

The Federal High Court in Abuja on Monday ordered the Nigerian National Petroleum Corporation (NNPC) and Mobil Producing Nigeria Unlimited to pay theN82 billion judgement debt owed some oil communities in Akwa Ibom State.

The communities in Ibeno Local Government Area of the state led by Obong Effiong Archianga and nine others had sued NNPC and Mobil through their lawyer, Lucius Nwosu, a Senior Advocate of Nigeria (SAN).

They had, in their original suit, sought about N100 billion compensation for economic losses they had suffered as a result of the oil spillages caused by the two oil giants during exploration.

The judge, Taiwo Taiwo, in a judgement in June 2021, ordered Mobil and NNPC to pay the Akwa Ibom oil communities cumulative damages of N81.9 billion over oil spillage that ruined their economic lives.

“The companies during exploration had been using decrepit pipelines under water and caused multiple spills. They were asked to recompense,” Mr Nwosu told journalists on Monday.

With the judgement debtors reluctant to pay the money, the creditors had returned to the Federal High Court for enforcement the judgement by initiating garnishee proceedings.

Ruling

Ruling on the communities’ garnishee applications, on Monday, the judge dismissed all the objections raised by the two oil firms and the Central Bank of Nigeria (CBN).

“Since all challenges to the order nisi dated 15 December, 2021 have been dispensed with and found lacking in merit, the order nisi is hereby made absolute against the garnishees,” Mr Taiwo held.

PREMIUM TIMES reported last week how Seplat Energy entered into a contract with a Nigerian unit of Texas-based supermajor Exxon Mobil, to procure Mobil Producing Nigeria Unlimited’s entire oil assets in Nigeria that date back to 1961 when the American firm first got the nod to prospect for oil in the country.

This development, Mr Nwosu said is “unfortunate,” urging the NNPC to quickly get Mobil’s assets in its custody to pay the judgement debt, warning that the Nigerian government will be held liable.

Abayomi Omoruwa, a Senior Advocate of Nigeria, while arguing in the garnishee nisi proceedings on behalf of the CBN, had said the central bank needed to get the consent of the Attorney-General of the Federation (AGF) before enforcing the garnishee order.

But the court ruled on Monday that the AGF’s consent is a colonial constitutional provision aimed at frustrating the enforcement of a judgement debt against the government, which the Supreme Court of Nigeria has in several instances dismissed.

The judge added that it was wrong for the central bank to anchor its enforcement of the court’s order on the consent on the AGF.

Earlier, the judge dismissed an application challenging the service of garnishee order nisi on the judgement debtors.

Mr Taiwo noted that the coming into effect of the Petroleum Industry Act had altered the name of the judgement debtor.

However, the court said the CEO, Directors, employees of NNPC are still those of NNPC Ltd, adding that the NNPC Ltd inherited assets and liabilities of NNPC.

“It follows that the suit identity of the judgement debtor has been known, and the misnormer will be corrected, since it’s a mistake of a name.

“Judgement debtor is juristic person, and the applicant has not suffered any injustice upon the mistake in the name of the applicant.

“Stance of applicant’s counsel is colourful and technical. The Court has power, suo moto to grant amendment of the name if mistakenly written.

“When a misnomer occurs, it does not vitiate the subject matter of the case.

“The object of the court is to make findings and dispense justice and not to punish a litigant for a misnomer,” the judge held.

The court added that the judgement creditor can enter claims “jointly and severally” against the judgement debtors (NNPC and Mobil).

Backstory

In his decision last June in a joint suit filed by the aggrieved oil producing communities, Mr Taiwo held that Mobil, the American oil company, and the NNPC were negligent in the way they handled oil spills that caused environmental degradation in the communities.

Specifically, Mr Taiwo took umbrage at the NNPC for being interested in revenue generation from oil exploration at the expense of the lives of the people in the communities.

The judge said he believed the oral and documentary evidence adduced by the plaintiffs to support their claims that lives were made miserable for them when their water and land were polluted through crude oil leakages from old oil pipelines.

Mr Taiwo noted the claims of Mobil that it did clean up exercise and held that the oil giant failed to address the compensation that would have mitigated the economic losses of the people said to be mainly fishermen and farmers.

He further held that both Mobil and NNPC were negligent by their failure to visit places of the leakages of the crude oil that led to the contamination of rivers and creeks.

The court rejected the claims of the Mobil’s joint venture partner, NNPC, that the suit was statute barred in 2012 when it was filed by the aggrieved plaintiffs.