AmbyUneze in Owerri
An indigenous Oil and Gas Company, Petroleum Zion Ltd, has filed a suit against PJT Partners UK and their
security trustees (a subsidiary of Blackstone UK), African Capital Alliance (ACA), Vertex Energy and First Hydrocarbon Nigeria (FHN) over alleged breach of contract and interference into a contract.
In a suit no: FHC/L/CS/844/2016 filed before Justice M.B. Idris of a Federal High Court, Lagos was sequel to a recent divestment exercise conducted by Blackstone (later taken up by PJT Partners) in September 2015 to sell Afren’s 100 percent stake in FHN26 Limited, which is an indigenous subsidiary of Afren that owns 45 percent working interest in OML26 Oil Block located in the inland Niger Delta region. The oil block currently operated by the Nigerian Petroleum Development Company Ltd (NPDC) has two producing fields (Ogini and Isoko) with current potential of 10,000 barrels per day.
Zion was declared the highest bidder in the transaction, which held atTranscorp Hilton Abuja on 21st October 2015 and became preferred bidder having met its financial obligation and negotiated a Sales Purchase Agreement (SPA) with PJT to complete the acquisition for $100 Million consideration.
The plaintiff also alleged that PJT Partners in conjunction with FHN senior management had contrived with ACA and Vertex to circumvent the transaction by going behind Zion’s back to sign SPA for same amount without warning o right of preemption just in a weekend preceding May 30, 2016, the week that Zion and PJT had scheduled a handshake to sign their SPA in London.
Zion approached the court to compel the FHN26 to honour agreed terms of the sale by completing the transaction for which it has raised full funding and incurred huge costs liable for $230million in losses.
In addition, Zion is claiming substantial damages from ACA for suspiciously monitoring their transaction secretly and obtaining valuable information through their inside channels within FHN / PJT and for unlawful interference with their economic interest, whilst also claiming expenses from PJT Partners for breach of confidentiality, lack of goodwill by stringing ACA along the entire process and for misleading Zion throughout the 10 month-long transaction period.
The case came up for the first time on June 30, 2016 and has been adjourned to a future date.
