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Tuesday, 19 August 2014

NNPC, Zenith In Messy Oil Bloc Quagmire!

Zenith logo Nigdel United Oil Company Ltd (NUOCL) is a customer of Zenith and has maintained banker/customer relationship.  NUOCL applied to Minister of Petroleum Resource (MPR) and Nigeria National Petroleum Corporation (NNPC) to own a bid for an oil prospecting license (OPL 233) in Nigeria 2006 Mini Round Bidding for Oil Blocks.
Under the terms and conditions of the grant of the Oil Block, NUOCL was to pay a total signature bonus commitment of the sum of $11,000,000,00 (Eleven Million US Dollars) to the MPR and NNPC respectively.
In pursuance of the banker/customer relationship existing between NUOCL and Zenith bank, NUOCL approached his bank (Zenith Bank) for credit facilities in the sum of $11,000,000,00 (Eleven Million US Dollar) to be utilized for the payment of the signature bonus in respect of OPL 233 to be allocated to NUOCL by MPR and NNPC.
Nigeria United Oil Company Ltd’s application to Zenith bank for credit facility and for the relationship between them, Zenith bank grant the credit facilities in two tranches in the total sum of $11,000,000.00 US Dollar to enable NUOCL finance the payment of the signature bonus for OPL 233 it won from NNPL and MPR
That pursuant to the bank’s offer letter which was duly accepted the NUOCL, Zenith Bank granted NUOCL a short term loan in the sum of $2,750,000,00 (two million, seven hundred and fifty thousand dollar) for a tenor of ninety (90) days to finance payment of signature bonus commitment in respect of OPL 233 Oil block to be allocated to NUOCL by Minister of Petroleum Resources and NNPC. In furtherance of NUOCL’s acceptance of the credit facility, NUOCL forwarded to Zenith board resolution accepting the said facility.
It is the terms of the agreement between Zenith bank and NUOCL as contained in the Zenith bank credit facility $2,750,000,00 shall be secured by NUOCL assigning 25% of its interest in the Oil Block allocated to her by NNPL and MPR in favour of Zenith bank.
By the agreement between Zenith Bank and NUOCL, NUOCL was obligated to execute an irrevocable assigning 25% right in respect of the Oil Block to Zenith but NUOCL failed and refused to do so.
Also, Zenith bank granted another credit facility in the sum of $8,250,000,00 to NUOCL vide an offer letter which was duly accepted by Zenith Bank. In accepting the said credit facility, NUOCL forwarded its board resolution to Zenith Bank.
The said credit facility in the sum of $8,250,000,000 was for a tenor of twelve months and it was granted to enable NUOCL finance the payment of the 75% balance of the signature bonus commitment payment in respect of OPL 233 Oil Block to be allocated by NNPC and MPR respectively.
The aforesaid credit facilities of $11,000,000,00 was secured by NUOCL was of assignment of 100% of its right in the OPL 233 Oil Block allocated to NUOCL by NNPC and MPR
By the terms of the letter dated 11th Sept., NUOCL was obligated to execute an irrevocable mandate assigning 100% of its rights in the OPL 233 OIL Block allocated to by NNPC and MPR in favour of Zenith bank.
However, Zenith Bank, following the terms of the credit facilities advance to the NUOCL prepared an irrevocable mandate assigning 100% of the NUOCL’s interest in the OPL 233 to Zenith bank to serve as security for the credit facilities Zenith Bank advanced to the NUOCL, but NUOCL refused to execute the said irrevocable mandate.
Zenith bank management revealed that the credit facility in the sum of $2,000,000,00 granted to NUOCL vide offer letter dated 14thAugust, matured on 17th November, which the credit facility in the sum of $8,250,000,00 granted to NUOCL vide Zenith bank offer letter dated 11th September, ever since the maturity of the aforesaid facilities, NUOCL was wilfully and persistently refused and failed to liquidate same Oil Block.
Source have it that Zenith bank revealed that NUOCL, from onset had the intention not to pay the credit facilities to the bank and that was why it failed/refused to execute the irrevocable mandate assigning its 100% interest in the OPL 233 as security for the loan.
The two parties agreed on interest rate payable in respect of the facilities Zenith Bank granted NUOCL was 25% per annum.
Zenith Bank aver that, the sum of $15,900,089,99 was outstanding in the account of NUOCL with the bank being the unpaid credit facilities the bank availed NUOCL plus interest. With this claims and intentions, Zenith Bank Plc as dragged NNPC, MPR and NUOCL to court.
NNPC claims that this is a fraudulent act/move by Zenith Bank as NNPC has never part of any agreement made by either party.
However, all the claims by Zenith are not acceptable by NNPC as a defence statement was issued.
NNPC as hereinafter expressly denies each and every averment of facts contained in the statement of claims as if same has been set down and denied seriatim.
NNPC is not in a position to admit to most of the claims mentioned by Zenith Bank but however admits that NUOCL is a customer of Zenith Bank and also won the bid for an oil prospecting License (OPL 233) and was also awarded license thereto after fulfilling all the requirement of the law.
Shybellmedia gathered that, Zenith bank should have encourage its client in every way to pay up instead of dragging them to court.
Moreso, NNPC revealed that, was not a part to any agreement entered between Zenith Bank and NUOCL. There exists no privy of contract between NNPC and either Zenith Bank or NUOCL in respect of any loan facility or any transfer of any interest in license issued.
NNPC is not aware of any of such agreement entered between Zenith and NUOCL.
NNPC cannot be bound by any agreement which he was not a party to. 
Metro news 

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