Access Bank drags Seplat oil, others to court over $85.8bn debt

December 7, 2020
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Following an outstanding loan of about $85.8bn, Access Bank Plc, has sealed the offices of Seplat Petroleum Company over third party loans owed it by Cardinal Services, a firm linked to Seplat.

It would be recalled that Access Bank last week obtained an Ex-Parte Order from a Federal High Court against Cardinal Drilling Services, Seplat, ABC Orjiakor, and Kalu Nwosu, while also obtaining a Mareva injunction freezing the accounts of Seplat in Nigeria and abroad.

It was gathered that the Mareva Injunction targeted the following assets; 25, Lugard Avenue, Ikoyi, Lagos, 6, Agodogba Avenue, Parkview, Ikoyi, Lagos and the one at 11, Oba Adeyin’ka Oyekan Street, Ikoyi, Lagos.

The Bank explained in a court filing that its decision to go after Seplat was because there is an “intercompany relationship between SEPLAT and Cardinal Drilling”, noting that “they are jointly promoted by Orjiako” , its primary target.

According to the document, “SEPLAT is a sister company to Cardinal, jointly promoted by Orjiako who is the alter ego of the two companies.”

However, when contacted, Seplat claims it is neither a shareholder in Cardinal Drilling and that it has no “outstanding loan obligations or guarantees to Access Bank and did not at any time make any commitments or guarantees in respect of Cardinal Drilling’s loan obligations” to the bank.

According to a source, Cardinal Drilling Services obtained a loan from Diamond Bank in 2012 and used it to purchase CDS Rigs 101, 201, 202, and 203.

The rigs were used to provide drilling services to Seplat in a contract that helped fund Cardinal Drilling services 60 per cent equity in a JV with Maurel & Prom.

Sources at Access Bank alleged Cardinal Drilling Services was a vehicle setup to obtain the loan to purchase the drilling services knowing fully well that Seplat was to be the main beneficiary.

Meanwhile, it was gathered from reliable sources that by joining Seplat to the case, Access Bank believes it will pile pressure on Seplat forcing it to reach a deal that will either see the loan repaid or get some guarantees from Seplat that it will get ABC Orjiakor to allow the bank take over the assets of Cardinal Drilling without a tussle from Orjikor.

Seplat in its annual report disclosed that “Cardinal Drilling Services Limited (formerly Caroil Drilling Nigeria Limited): Is owned by common shareholders with the parent company. The company provides drilling rigs and drilling services to Seplat. Transactions with this related party amounted to N2.89billion, $9.44million (N621million, $2.03million). Receivables and payables were nil in the current period (receivables in 2018: N1.49billion, $4.87million).”

Access Bank is understood to be grappling with a string of bad loans issued under the defunct Diamond Bank, and is therefore stepping up efforts to go after some of the debtors by obtaining several court orders to seize properties

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