FirstBank has secured a major Court of Appeal victory in its case against General Hydrocarbons Limited over crude oil collateral, reinforcing legal protections for high-value transactions
First Bank of Nigeria Limited (FirstBank) has secured a landmark victory at the Court of Appeal in its legal battle against General Hydrocarbons Limited (GHL) over the diversion of crude oil pledged as collateral.
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The ruling, delivered on Thursday, September 11, 2025, set aside the earlier judgment of the Federal High Court, Port Harcourt (Obile J), which had dismissed FirstBank’s claims regarding the alleged fraudulent diversion of proceeds from the sale of crude oil cargo.
The dispute centred on crude oil aboard the FPSO Tamara Tokoni, which GHL had pledged to FirstBank as security for substantial loan facilities.
Contrary to the pledge agreement, GHL allegedly diverted proceeds from the sale of the cargo, leading the Bank to seek judicial intervention.
Represented by Babajide Koku SAN and Victor Ogude SAN, FirstBank appealed the trial court’s ruling, arguing that the matter was maritime in nature and not a simple debt recovery claim.
In its decision, the Court of Appeal upheld FirstBank’s position, stressing the need to preserve the Res (the crude oil cargo) as the central issue in dispute.
The appellate court:
Set aside the Federal High Court’s ruling that vacated the order of arrest of the 2nd respondent.
Authorised the sale of the crude oil aboard the FPSO Tamara Tokoni.
Ordered that the proceeds be deposited into an interest-yielding escrow account under the custody of the Chief Registrar of the Court of Appeal.
Directed the Chief Registrar to take possession of the cargo and protect it against dissipation or unauthorised disposition pending trial and arbitration.
This judgment marks a significant milestone for FirstBank, reinforcing its commitment to corporate governance, legal compliance, and asset protection.
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Legal experts say the ruling also sets a strong precedent for the enforcement of collateral agreements in Nigeria’s commercial and maritime sectors.
