Akin Kuponiyi
A limited liability company, Seistech Energy Limited, has filed a petition before a Federal high court in Lagos south west Nigeria, urging the court to wind up an exploration and production of crude oil company Summit Oil International limited on the ground that the company is insolvent and unable to pay its debt .
In a petition filed before the court by a Lagos lawyer, Barrister Fidel Albert, on behalf of Seistech Energy company against Summit Oil International limited, it was alleged that,Summit. Oil international company is a joint leaseholder and joint developer of Oil Mining lease OML 142 formerly OPL 205 ,in respect of the Otien-1Field located in the Anambra basin on the North edge of the Niger -Delta.
The company was granted the Oil prospecting licence but could not develop the asset for about 20 years, due to severe cash flow constraints.
It was also clear that the company lacked certain basic infrastructure to transport the crude Oil and condensate from the production wells to truck loading gantries, as well as the facility for transporting the hydrocabon fluids preparatory to export.
On the account of this actute infrastructural deficiency and the technical know-how the company contracted the Petitioner Seistech Energy limited vide the provision of installation and construction of other. Delivery line contract of April, 2017.for an end to end design, construction and installation of delivery line for the company including provision of six storage tanks.
However, after the completion of the contract, the petitioner issued its invoice to the respondent for the payment of the first tranche of the contract sum due in the sum of N11,868,703.75,representing 50% of the contract price payable as mobilisation and same duly paid by the respondent.
However upon payment of the first mobilisation the respondent failed to make subsequent tranche payments to the petitioner, as had been agreed, as at when due.
The respondent did not dispute the Petitioner’s invoices but rather gave several promises to liquidate them, but however failed to do so till date.
The respondent was alleged to be indebted to the petitioner to the tune of N69,210,671.75, as at June 2018,which accrued to the petitioner as payment for the installation and construction of the respondent’s Otien delivery line, including tank rentals associated with that work scope.
The Petitioner avers that it has repeatedly made applications to the respondent for payment of its debt but the company has failed and neglected to pay same on account of insolvency and is unable to pay its debts to its creditors as the obligation falls due.
In the circumstances, it is just and equitable that the company be wound up. Consequently the Petitioner prays as follows
That Summit Oil international limited be wound up by this honorable court under the provisions of the Company and Allied Matters Act on grounds of its inability to pay its debts.
However in an affidavit in support of notice of preliminary objection sworn to by Chief Financial Officer of Summit Oil International limited Tajudeen Jinadu and filed before the Court by the law firm of G. Elias and company, the respondent company averred that the dispute between the two parties regarding the amount to be paid in relation to the actual work done by the respondent is one which ought to be resolved by parties by negotiations as the applicant is aware of clause of the contract which is dispute resolution clause which mandates both parties to resolve any dispute under the contract by arbitration but rather than initiating arbitral proceedings to enable the dispute to be resolved as agreed in the contract, the applicant maliciously commenced this winding up proceedings against the respondent.
The respondent is willing and able, to expeditiously proceed to arbitration once referred to arbitration by the court or the respondent gives it notice of reference to arbitration.
Consequently the company contended that the court lacks jurisdiction to entertain the petition,as the petition constitute an abuse of court process, therefore it will serve the interest of justice if the petition is struck out Meanwhile the case has been adjourned till 26th of September, 2018.for hearing.