FirstBank vs General Hydrocarbons Limited: The Issues

In recent times, there have been accusations and counter accusations as well as exchange of words between FirstBank, Nigeria’s oldest financial institution and the General Hydrocarbons Limited (GHL), over what is believed to be a contractual dispute. The dispute arose from the operation of the Oil Mining Licence, OML120 owned and operated by GHL. Media […]

In recent times, there have been accusations and counter accusations as well as exchange of words between FirstBank, Nigeria’s oldest financial institution and the General Hydrocarbons Limited (GHL), over what is believed to be a contractual dispute.

The dispute arose from the operation of the Oil Mining Licence, OML120 owned and operated by GHL. Media mogul, Mr. Nduka Obaigbena, who is the Chairman of This Day/Arise Media, is also the chairman of the oil firm.

The two parties have engaged in intense media war since January, when the issue first broke out following a court order allegedly freezing accounts of General Hydrocarbons Limited over $225m debt being owed FirstBank. Daily Trust brings forward the issues.

 

December court verdict

The judgement which was made public in January was delivered on December 30, 2025.

In the judgement, the Federal High Court in Lagos issued a series of orders, including Mareva injunctions, to freeze assets and accounts linked to General Hydrocarbons Limited, its affiliates, and prominent individuals, including media mogul, Nduka Obaigbena. The court hinged its decision on the allegations of unpaid loans totaling $225.8 million which were issued in September 2024.

The plaintiffs in the case are First Bank of Nigeria Ltd and FBNQuest Trustees Ltd, both subsidiaries of FirstHoldCo then known as FBN Holdings Plc.

The court further directed all major commercial banks and financial institutions in Nigeria to block the defendants’ accounts’ and restrict access to funds or assets up to the claim amount, pending further legal proceedings.

Financial institutions were also restrained from releasing funds or handling assets linked to the defendants.

The court verdict read: An order of Mareva injunction restraining all commercial banks in Nigeria, including Guaranty Trust Bank Limited, Access Bank Plc, Citibank Nigeria Limited, Carbon Bank, Ecobank Nigeria Plc, Fidelity Bank Plc, First Bank of Nigeria Limited, First City Monument Bank Plc, Flutterwave, Globus Bank, Heritage Bank Limited, Jaiz Bank, Keystone Bank Limited, Opay Digital Services Limited, PalmPay Limited, Paystack Payments Limited, Piggyvest, Momo Payment Service Bank Limited, Polaris Bank Limited, Providus Bank, Stanbic IBTC Bank Nigeria Limited, Standard Chartered Bank, Sterling Bank Plc, SunTrust Bank Limited, Union Bank of Nigeria Plc, United Bank for Africa Plc, Unity Bank Plc, Wema Bank Plc, Zenith Bank Plc, and all other financial institutions operating in Nigeria, from releasing or dealing with any funds or assets due to the GHL up to the sum of $225,802,379.69,being the outstanding indebtedness on the GHL’s account with FirstBank as of 30 September 2024 in respect of the loan facilities granted to GHL by FirstBank pending the hearing and determination of the Motion on Notice for interlocutory injunction.

But the GHL quickly fought back after the well publicised court judgement. In its equally well publicised response to the court judgement, the GHL denied owing FirstBank.  

Speaking through its Director of Strategy & Operations, Abdelmuizz Bello, the oil company explained that it entered a legally binding, enforceable Subrogation Agreement with First Bank on May 29, 2021 with FBN agreeing to fund GHL’s exploration, production and development of OML 120 in exchange for sharing profit from oil proceeds at 50:50 ratio and taxes over 8 years.

It explained that the FBN’s 50% share will then be used to pay down its non-performing loans of about $718million which was discounted to $600m to resolve its solvency issues therefrom.

According to the firm, the agreements signed with GHL enabled the FBN to return to good standing as it would enable FBN to declare a profit of N151Bn ($377.5million) for the year ending December 31, 2021 instead of N302Bn loss at the then exchange rate.

GHL added that the agreements made it clear that the Non-Performing Loan had nothing to do with GHL beyond the fact that 50 per cent of profits from OML 120 due to FBN under the Subrogation Agreement will be used by FBN to settle the hole created in its books by the Non-Performing Loan (NPL).

However, GHL noted that FirstBank failed to meet its financial commitments as outlined in its agreements, leading to operational difficulties and inability to achieve its production target.

“Essentially, GHL’s grouse is FBN’s failure to meet its agreed and executed financial commitments which GHL had believed would be made, when it signed the agreement resulting in critical challenges for the development of OML 120,” it said.

 

Court lifts Mareva injunction against GHL

On January 30, the Federal High Court in Lagos vacated the Mareva orders that froze $225.8 million in assets and accounts linked to GHL, its affiliates, individuals, including Mr. Obaigbena.

Justice Deinde Dipeolu, in a ruling, held that the setting aside of the order was due to an earlier preservative order pending arbitration by a sister court on the matter on December 12, 2024.

“I have earlier on held that although, the interim orders made by this court on the 30th of December, 2024 are in relation to the subsequent facilities agreement between the plaintiff and the Ist defendant and it does not extend to the receivables in the agreement of 29th of May, 2021, also the present suit on the face of it if placed side by side with FHC/L/CS/1953/2024 is not an abuse of process for the reasons given above, however, in view of the orders of Allagoa J. made on the 12th of December, 2024, the Mareva order granted by this court on 30th December, 2024 is hereby set aside,” the judge said.

Following the judgment, banks immediately complied by lifting the restriction, according to another statement by the General Hydrocarbons Limited.

 

GHL files defamation suit

Shortly after the judgement in its favour, directors of the oil and gas company took a step further by instituting a defamation suit against FirstBank, seeking compensation up to the tune of $1bn in damages and wrongful freezing of their accounts.

 

‘GHL vessel arrested’

As the dispute between the parties continued, the Federal High Court, Port Harcourt Judicial Division, ordered the arrest of the entire cargo onboard the Floating Production Storage and Offloading (FPSO) Vessel Tamara Tokoni, located in Rivers State, linked to GHL.   

Justice E.A. Obile issued the ruling in an ex parte motion filed by First Bank of Nigeria Limited (FBN) on January 9, 2025, as FBN insisted on a $19,752,304.84 bank guarantee and the payment of costs by GHL and others before they can tamper with or transact the crude oil products onboard the vessel.   

The application aims to secure FBN’s financial claim against GHL, the cargo of crude oil onboard FPSO Tamara Tokoni, as well as the owners, operators, and master of the vessel, listed as the first to fourth defendants.

Following the court order, the Nigerian Navy reportedly arrested the vessel while detaining the cargo onboard the FPSO vessel until further orders are issued.  

 

‘Port Harcourt case dismissed’

However, on March 26, 2025, the Federal High Court in Port Harcourt, Rivers State, dismissed the suit filed by First Bank Nigeria Ltd against GHL. 

Justice E.A Obile dismissed the entire suit on the grounds that the court lacked the jurisdiction to entertain the case, upholding the arguments of counsel for General Hydrocarbons Limited., Dr ‘Biodun Layonu, (SAN).

 

FirstBank appeals verdict

But the bank said it has appealed the Federal High Court Port Harcourt’s decision to dismiss the suit, while disagreeing with the court’s decision, which determined that the matter in contention is not a maritime claim but a debt recovery case.

The bank expressed dismay at the court’s declaration that the arrest order against the cargo on the FPSO expired by effluxion of time within 14 days of its issuance, considering that it was ex-parte in nature.

Given its dissatisfaction with the ruling of the court, the bank has appealed against the decision, insisting that the cargoes of crude oil on the FPSO Tamara Tokoni remain arrested.

“While First Bank has great respect for the courts, it strongly disagrees with the ruling, which, in our view, constitutes a miscarriage of justice,” the lender said while explaining the decision to appeal the judgement.

 

Dispute before arbitration

Daily Trust reports that both parties are presently before arbitration with a view to resolve the long standing dispute.

However, the recent transaction in FirstHoldCo shares further reignited the controversy with both parties resuming exchange of words, following a report by This Day newspaper.

The dispute between GHL and FirstBank has further been linked to the powerplay over the soul of the FirstHoldCo where Mr. Femi Otedola, the Chairman, controls the largest shares.

Recently, the Federal Government denied media reports that it acquired a 25% stake in FirstHoldco.

In a statement signed by Kamarudeen Ogundele, the Special Assistant to the President on Communication and Publicity, office of the AGF, it stated that neither the Federal Government nor the Attorney General’s office participated in acquiring the shares in question.

“The circumstances surrounding the shareholding structure are distinct from any government involvement,” Ogundele stated.

The AGF’s office explained that a trustee set up by First Holdco, with the Central Bank of Nigeria approving Stanbic IBTC as a third-party overseer, is involved in the shareholding structure.