The Federal High Court in Lagos has granted an interim mareva injunction directing commercial banks to block Shell Petroleum Development Company of Nigeria Ltd accounts.

A mareva injunction is a court order freezing a party’s assets, until the determination of a case they are involved in, to stop them from taking it abroad.

The order was in a bid to recover the cash equivalent of more than 16 million barrels of crude oil allegedly diverted by the oil giant from AITEO Eastern E & P Company Ltd.

Oluremi Oguntoyinbo, the judge, gave the order Wednesday following an ex parte application where AITEO Eastern E & P Company Ltd is the plaintiff/applicants and SPDC Ltd is the first defendant.

Joined in the suit are Royal Dutch Shell Plc, Shell Western Supply and Trading Ltd, Shell International Trading and Shipping Company Ltd and Shell Nigeria Exploration and Production Company Ltd as second, third, fourth and fifth defendants.

The court restrained the defendants or their agents from presenting to the banks “any mandate or instrument for the withdrawal of any money and /or funds standing to the credit of any of the accounts” of the defendants kept/maintained “at any of the named respondent banks.”

To allow that, the court said the banks must first “ring-fence $1.2 million or its equivalent in any other official currency including but not limited to the naira and/or pound sterling being the value of the plaintiff’s 1,022,029 barrels of crude oil. The value was derived at the rate of $79.50 per barrel as stated in the Department of Petroleum Resources (DPR) letter dated 8th day of July, 2020, the court added.

Again, the court ruled that the banks should not allow that without first preserving and or ring-fencing the total sum of $2.7 million or its equivalent in any other official currency.

The sum comprises $799 million being the amount claimed to have been paid by the plaintiff to the five defendants for the acquisition of the Nembe Creek Trunk Line (NCTL) pipelines and the assets, and $389,631,877.76 claimed as having been lost by the plaintiff arising from the leakages in the NCTL and the degraded conditions of the NCTL

The rest includes $578,951,901.99 claimed as having been lost by the plaintiff arising from the crude theft/larceny in the NCTL, and $933,000,000 claimed as having been expended for the repairs of the pipelines and acquisition of the equipment including well-heads, generators and pumps as well as replacing the flow lines within the NCTL.

The judge further directed the respondents’ banks “to pay any sums of money standing to the credit of the defendants within 48 hours of the service of the order” of the court into an interest yielding account in the name of the court’s Chief Registrar, who is to hold the same in trust.

“Pending the hearing and determination of the motion on notice for interlocutory injunction, the respondent banks are directed to sequestrate and/or ring-fence any cash, bonds, deposits, all forms of negotiable instruments or chose(s) in the action due to or standing to the credit sum/value of the amounts stated in prayer 1,2,2 and/or 4 above,” the judge added.

When the matter came up on Monday, the court was informed that the defendants had filed an application seeking to discharge the order.

The judge adjourned further proceedings till February 24.