TheCable

Seplat Petroleum Development Company now has access to its corporate offices after the Lagos division of the court of appeal suspended an interim order that restricted its access to the premises.

A federal high court had previously issued a Mareva injunction sealing the company’s assets over a loan that Cardinal Drilling Services Limited allegedly owed Access Bank.

Joseph Ikyegh, while delivering the judgement, said the balance of convenience favoured the petroleum company adding that Access Bank has nothing to lose if Seplat continued to discharge its obligation to its clients.

“The fear and anxiety expressed by the first respondent (Access Bank) appeared unfounded. It would also not amount to hearing the substantive suit,” Ikyegh said.

“The supreme court has held that where machines and workers would be rendered useless, the court would intervene.

“Disruption of business should be considered in the issue of balance of convenience. The court will exercise its discretion in suspending the injunction. A practical approach should be adopted and not do injustice to any of the parties.

“Where considerable hardship will be done to a party, the court will intervene by suspending the injunction or stay it.

“I found substance in the argument. The injunction restraining the appellant from operating is hereby suspended. Order on its accounts is also lifted pending the determination of the appeal.”

The justice, however, ordered Seplat to issue a bond of $20 million in the name of the court’s chief registrar; an order which Etigwe Uwa, the company’s counsel, said has been complied with.

The court said Seplat supplied gas to three power plants that generate almost 40 percent of power supply in Nigeria and that it would not be able to deliver this service if the order was not suspended.

Seplat argues that it has no connection whatsoever with the $85.5 million loan or the debenture with which it was secured and that the high court was wrong to have issued the order sealing its premises.

The company explained that the loan agreements evidenced by letters of offer of the credit facility were all between Diamond Bank Plc. (now Access Bank Plc.) and Cardinal Drilling Services Limited, while the three Deeds of Debenture to the loan were over specific and fixed assets of Cardinal Drilling viz four drilling rigs set out in the schedules of the three deeds of debenture.

It also denies claims that it undertook to repay the indebtedness of Cardinal Drilling.