General Hydrocarbons Limited vs FBN: The Explainer
GHL vs FBN: The Facts, The Half-Truths and The Fiction
1.Is GHL’s liability to First Bank a loan? The simple answer is NO,as it is
not a normal commercial loan:it is a Project Finance relationship.
Here is how:
2.GHL is the awardee and licenced operator of OML 120. FBN approached
(discounted from $718million from AMCON’s Eligible Bank Asset)in
and share profit 50:50, while paying FBN cost of finance.The FBN 50%
order to resolve FBN’solvency issues.
GHL to finance the exploration,development and production of OML 120
In doing that, GHL guaranteedFBN’s liability to AMCON, through a
share is dedicated to pay down its non-performing loan of $600million
Tripartite Agreement between GHL, FBN and AMCON
3.The result of the Tripartite Agreement was that FBN became immediately
the project has not achieved commercial production.So,at best FBN’s
its financial statements open to challenge.Meanwhile the FBN’s claim of
downtimes of $47th million, which has snowballed into the current impasse
precedent to profitability in failing to finance OML 120 as agreed, leaving
profitable and moved from a loss of N302Billion to a profit of N151Bn for
as FBN has failed to make further required payments for the drilling and
required for the optimal exploration and development of OML 120 as
exploration of OML 120.Essentially, FBN failed to fulfil its condition
2021 FYE. However, in return,it has failed to meet its commitment under
$225Million loan is not due as it is still covered by moratorium, given that
the Tripartite Agreement to fully finance and make the payments
agreed in the Tripartite Agreement, resulting in losses in day rate and
The claim is premature.
.GHL has now gone for Arbitration which is ongoing and FBN has gone
reputable companies with strict compliance regimes.
verification by FBN, and the 3rd parties are mainly global, world class,
whilst the second temporary Mareva is pending at the Federal High Court
5.Did GHL dissipate any assets? The answer is no as all payments were made
GHL will continue to fight for justice and damages whilst remains open
claiming $225million debt which it never complied with in line with the
by First Bank DIRECTLY to 3rd parties after due diligence and
6.GHL is filing a claim of over $1 Billion in various courts, while FBN is
which has been vacated and the case is now being heard on the merit,
agreements.
unproven allegations of dissipation of assets.”
to court with a series of Exparte (temporary) Mareva measures, the first of
in Port-Harcourt, Rivers State, both supported by”wild, unfounded and
for mediation and resolution.