FG’s $406.7m Debt Recovery Suit Against Shell Adjourned

Shell profit drops 44 percent
  • FG’s $406.7m Debt Recovery Suit Against Shell Adjourned

A Federal High Court in Lagos has adjourned until June 19 hearing in a debt recovery suit filed by the Federal Government against Shell Western Supply and Trading Ltd over an alleged $406.7m shortfall in crude oil shipment.

The suit numbered FHC/L/CS/336/16, was filed by Fabian Ajogwu, the counsel to the Federal Government.

It has as defendants, Shell Petroleum Development Company of Nigeria Ltd and Shell Western Supply and Trading Ltd, its subsidiary.

The money was said to be for crude oil lifted in 2013 and 2014.

The suit is pending before Justice Mojisola Olatoregun.

The case was adjourned until June 19, due to the Eid-Il-Fitr celebrations, and the new date has already been communicated to the respective parties.

In the suit, the plaintiff is claiming the sum of $406.7m from the defendants, representing the shortfall of money it paid into the Federal Government account with the Central Bank of Nigeria.

In a supporting affidavit, the Federal Government had accused the Anglo-Dutch company of not declaring or under-declaring crude oil shipments during the period.

It said that this was following forensic analysis of bills of lading and shipping documents alleging that Shell cheated Nigeria of a deserving revenue.

According to the affidavit, the consortium of experts tracked the global movements of the country’s hydro-carbons, including crude oil and gas.

The plaintiff said that it identified the companies engaged in the practices that led to missing revenues from crude oil and gas export sales to different parts of the world.

The plaintiff revealed discrepancies in the export records from Nigeria with the import records at US ports, and averred that the undeclared shipments between January 2013 and December 2014 brought the total value of the entire shortfall to $406.75m.

The defendants were alleged to have failed to respond to a Federal Government letter through its legal representative, seeking clarification as to the discrepancies.

The Federal Government is, therefore, seeking a court order to compel the two companies to pay $406.7m, being the total value of the missing revenue and interest payment at 21 per cent per annum.

In addition, the government is also asking Shell to pay general exemplary damages in the sum of $406.7m as well as the cost of the legal action.

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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