FRI JULY 03 2026-theGBJournal| Nigeria’s Supreme Court ordered the immediate release of crude oil aboard the FPSO Tamara Tokoni to General Hydrocarbons Ltd. (GHL), overturning lower court decisions that had frozen the cargo at the request of First Bank of Nigeria.
The apex court ruled on Friday that the dispute arose from a commercial financing agreement rather than an admiralty matter, depriving the Federal High Court of jurisdiction and marking the latest twist in a years-long legal battle over the financing and development of the OML 120 oil block.
The five-member panel of the Supreme Court unanimously allowed GHL’s appeal, set aside the judgment of the Court of Appeal and ordered the Chief Registrar of the Court of Appeal and the Admiralty Marshal to immediately hand over the crude oil aboard the FPSO Tamara Tokoni to the oil producer.
Reading the lead judgment, Justice Habeeb Adewale Abiru held that the dispute between First Bank of Nigeria and General Hydrocarbons was fundamentally contractual and therefore fell outside the jurisdiction of the Federal High Court as an admiralty action.
The panel, which also included Justices Uwani Musa Abba Aji, Adamu Jauro, Emmanuel Agim and Tijjani Abubakar, ruled that both the Federal High Court and the Court of Appeal lacked jurisdiction to entertain the suit.
The litigation traces its roots to a May 2021 subrogation agreement executed to finance the development of Oil Mining Lease (OML) 120, which contains the producing Oyo oilfield. Under the arrangement, First Bank extended financing facilities to General Hydrocarbons, including obligations linked to a $718 million debt originally incurred by Atlantic Energy and subsequently transferred under agreements involving the Asset Management Corporation of Nigeria (AMCON).
The relationship later deteriorated after the lender accused GHL of defaulting on its obligations under the financing arrangements. General Hydrocarbons, which is majority-owned by media entrepreneur Nduka Obaigbena, disputed the debt claims and alleged that First Bank repeatedly breached the 2021 agreement by failing to disburse funds as scheduled, disrupting field operations and causing significant financial losses.
As the dispute escalated, First Bank obtained interim injunctions and Mareva orders from the Federal High Court freezing GHL’s bank accounts and authorising the arrest of crude oil cargo aboard the FPSO Tamara Tokoni, effectively preventing the company from lifting and marketing production from OML 120 while the litigation continued.
The parties subsequently referred their contractual dispute to arbitration before the Nigerian Institute of Chartered Arbitrators. In late 2025, the arbitral tribunal dismissed GHL’s claims that the bank had breached its obligations under the financing agreement, ruled substantially in favour of First Bank and ordered General Hydrocarbons to bear the costs of the arbitration and related legal proceedings.
Despite that arbitral outcome, the Supreme Court’s ruling focused on the procedural question of jurisdiction rather than the underlying commercial claims. By holding that the dispute was contractual and not an admiralty matter, the court effectively nullified the orders obtained through the admiralty proceedings, including the arrest of the crude cargo.
The judgment clears the way for General Hydrocarbons to take immediate possession of the crude oil aboard the FPSO Tamara Tokoni, while leaving any remaining contractual claims between the parties to be resolved through the appropriate legal or arbitral processes.
The decision is expected to shape how Nigerian courts distinguish between commercial financing disputes in the oil sector and matters that properly fall within admiralty jurisdiction.
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