Famfa Oil Limited V. Hon. Attorney-general of the Federation & Anor (2007)

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UMARU ABDULLAHI. J.C.A.

This appeal is against the judgment of the Federal High Court, by – Adah, J. sitting at Abuja, delivered on 31st May, 2006. The facts of the case are clear and are not in dispute. Put briefly, they are as follows:-

In May, 1993, the Appellant applied for an allocation of an Oil Prospecting License (OPL). The Appellant made all necessary payments in this respect and the license was granted accordingly. This license, will henceforth he referred to as OPL 216.

In September, 1996, the Appellant entered into an agreement with STAR DEEP WATER PETROLEUM LIMITED(STAR DEEP) as its technical adviser and at the same time transfer 40% interest in OPL 216 to STAR DEEP also later assigned 8% of its 40% interest in OPL 216 to another company called PETROBRAS 8% participation of interest in OPL 216.

In March, 2003, the Appellant applied to the Minister of the Petroleum Resources for conversion of OPL 216 to Oil Mining Lease (OML). The application for the conversion was granted in 2004. The result of this was that OPL 216 was converted to become OML 127.

I think it is important to mention that, before the application to convert OPL 216 to OML 127, the Appellant had to go to the Federal High Court and instituted an action against the 2nd Respondent. What triggered this suit arose from a letter written by the Ministry of Petroleum Resources dated 23rd March, 2000, informing the Appellant that the Government had acquired some 40% interest in OPL 216.

For the: purpose of clarity, I shall set out most relevant portion of the letter. It reads as follows:-

“The Chairman,

Famfa Oil Limited,

290A Ajose Adeogun Street,

P. O. Box 70681,

Victoria bland,

Lagos.

Dear Sir,