Federal High Court Suspends Shell's Accounts

Federal High court in Lagos has issued an injunction suspending Shell from withdrawing money until it budgets for the potential damages in a lawsuit brought against the company by Aiteo Eastern E&P.

Court documents revealed that Aiteo is seeking compensation over what it says was the poor condition of the pipeline and associated lost oil sales, Reuters reported.

Aiteo is seeking a total sum of $4 billion over alleged problems with the Nembe Creek Trunk Line (NCTL) pipeline it bought from the Royal Dutch company in 2015. The company is also claiming that Shell undercounted its oil exports. Aiteo accused Shell of deliberately metering improperly the Nigerian company’s oil exports from the Bonny Light terminal.

It is seeking $2.7 billion over the pipeline deal plus $1.28 billion for lost oil sales, the court documents show.

While Aiteo is not making any comment on an ongoing legal case, the Shell Petroleum Development Company (SPDC) spokesman said the allegations are “factually incorrect”.

“SPDC is working to secure an expeditious discharge of the freezing injunction, which we believe was obtained by Aiteo without any valid basis,” an SPDC spokesman said.