• Alleging illegal attempts to take over OML 42 assets linked to Neconde-Nestoil.
In a significant escalation in the ongoing legal battle shaping Nigeria’s oil and gas sector, a consortium of international financial institutions (Glencore Energy UK Limited, African Finance Corporation, Commercial Bank of Mauritius and Fidelity Bank) has filed suit against FBN Trustees Limited.
The suit targets both the FBN Management Board and the appointed receiver, Abubakar Sulu Gambari SAN, over what the foreign financier claims is an illegal attempt to seize control of Nekonde Energy Limited’s interest in the valuable Oil Mining Lease 42 (OML 42).
The foreign financiers claim that the appointment of Abubakar Sulu Gambari SAN as receiver and administrator amounts to an unlawful attempt to enforce the subordinate securities in violation of their rights.
Background: Disputed interests in Neconde and OML 42
Neconde Energy Limited, a leading player in Nigeria’s oil and gas sector, holds a 45% interest in OML 42, a strategically important oil asset.
Foreign financiers, comprising an international oil trading entity, an international financial institution, and Fidelity Bank, extended a credit facility to Nekonde, appointing the FBN Trustee as a safe receiver on agreed terms.
The dispute arises from a complex relationship between Nekonde, foreign lenders, and a consortium of Nigerian banks grouped as “Nestoil Lenders.”
These Nestoil lenders include First Bank Limited and FBN Trustees. Associated entities of First Bank Nigeria Limited also acted as trustees of Nestoil Lenders.
Allegation: Breach of Trust and Unlawful Creation of Security
At the heart of the lawsuit are accusations that the FBN Trustee breached its fiduciary and fiduciary duties by orchestrating the creation of a secondary security interest in OML 42’s Nekonde assets to benefit the Nestoil lenders.
The foreign lender contends that this security was created by a deed of assignment executed by the FBN Trustee, despite the express lack of express consent from the foreign lender, a requirement set out in the original terms of the lending relationship involving the FBN Trustee.
Notably, the lawsuit alleges that Neconde does not owe any money to Nestoil lenders, and further states that posting this additional collateral without the necessary consents is completely illegal.
Foreign lender position: claims and legal arguments
Plaintiffs allege that the FBN Board was fully aware of the need for prior approval and proceeded to create the disputed security interest despite its express refusal.
They argue that this action constitutes a material breach of trust and fiduciary duty and renders the FBN Trustee liable for acting in the interest of a party that has no legitimate claim to Nekonde’s assets.
The foreign financier is seeking damages and a judicial order to invalidate the disputed securities, remove the FBN Trustee from its role as securities trustee, and remove Abubakar Sulu Gambari SAN as purported recipient.
They ask the court to interpret and enforce the priority provisions of the facility agreement, bond, and intercreditor deed, and to determine the legality of both the subsequent security and the appointment of a receiver.
In their written address in support of the original summons dated December 11, 2025, the plaintiffs argued that the December 2022 indictment was executed without their consent and is void, void, and of no legal force.
Implications: New developments in the First Bank lawsuit and the investment environment
This development adds a layer of complexity to the ongoing legal dispute between First Bank Nigeria Ltd, Nekonde and Nestoil.
Legal experts say the involvement of multiple international financial institutions and allegations of fraudulent securities creation could have far-reaching implications.
The case raises serious ethical questions about the governance and transparency of banking in Nigeria, which could undermine investor confidence and cast a shadow on the country’s investment climate.
Critics warn that such disputes, if left unchecked, could deter future foreign investment and damage the reputation of Nigeria’s financial institutions.
Conclusion: Next steps and industry trends
Banking and oil industry players are closely monitoring the outcome as courts consider the foreign lenders’ claims.
