KEY POINTS
- The legal conflict of interest case has raised fresh concerns in Nigeria’s oil sector.
- Stakeholders say the legal conflict of interest case may affect trust in regulatory oversight.
- The dispute centers on a $1 billion claim tied to petroleum assets.
A protracted conflict in Nigeria’s oil sector has escalated following recent filings indicating that Babajide Koku, a prominent attorney, is representing both First Bank of Nigeria Plc and the Nigerian Upstream Petroleum Regulatory Commission in interconnected lawsuits without the consent of the opposing companies. The revelation has disturbed the stakeholders concerned and rekindled apprehensions of conflicts of interest in instances associated with high-value petroleum assets. Industry analysts assert that the move jeopardizes trust during a period when the sector is already contending with operational instability and regulatory scrutiny.
Legal conflict of interest case deepens
Neconde Energy Ltd and Nestoil Ltd are engaged in litigation against First Bank and its affiliated investment entities, FBN Quest Merchant Bank Ltd and First Trustees Ltd. The cases are pending before the Federal High Court in Lagos and Abuja. The cases, designated FHC/L/CS/2127/2025 and FHC/ABJ/CS/2369/2025, arise from the efforts of banking institutions to seize petroleum assets owned by Neconde and Nestoil. The banks assert that the corporations owe approximately $1 billion. The assertion has been central to the escalating disagreement, involving regulators and raising inquiries regarding the extent of banks’ jurisdiction over oil-producing properties during failed debt negotiations.
The disclosure regarding Koku’s dual representation has focused scrutiny on the ethical principles governing legal practice in matters involving regulators, private enterprises, and significant lenders. Attorneys involved in the case assert that the lack of informed consent is fundamental to the issue. They contend that regulatory entities such as the NUPRC should be shielded from any affiliations that may foster the appearance of partiality, particularly in matters with financial and operational consequences for asset-holding firms.
Stakeholders warn over legal conflict of interest case
According to The Guardian, observers of the conflict assert that the outcome may affect the management of future commercial disputes within the sector. They caution that the legitimacy of regulatory rulings is increasingly difficult to uphold when inquiries arise over the representation of conflicting parties in disputes valued at hundreds of millions to the national economy. In Nigeria, where oil production is important to revenue, the case has garnered attention not alone because to the debt claim, but also because the potential for regulatory neutrality may be scrutinized as the litigation advances.
