A Nigerian indigenous firm, Lagos Deep Offshore Logistics (LADOL) has dragged Samsung Heavy Industries of Korea, Total Upstream Nigeria Limited and the Nigerian Content Development and Monitoring Board (NCDMB) before a Federal High Court over an alleged plot to exclude it (the firm) from the execution of the local component of the $3.8 billion Egina Floating Production Storage Offshore (FPSO) vessel.
In the proceedings, which were issued for LADOL by a Senior Advocate of Nigeria (SAN), Professor Fidelis Oditah, LADOL is seeking 19 reliefs against Samsung and other defendants, and appealed to the court to make a declaration that a contract awarded by Total to Samsung on or about March 15, 2013 for the construction and installation of FPSO at Total’s Egina oilfield in Oil Mining Lease (OML)130 in deep offshore Nigeria is subject to the Nigerian Oil and Gas Industry Content Development Act 2010.
Other reliefs being sought by the company includes a “declaration that the Egina FPSO Project contract was awarded by Total to Samsung, with the approval of the Nigerian regulatory authorities including Nigerian National Petroleum Corporation (NNPC), National Petroleum Investment Management Services (NAPIMS), NCDMB and the Ministry of Petroleum, on the basis inter alia that a significant proportion of the steel fabrication and the integration of the FPSO topsides would be carried out at LADOL’s yard in the LADOL Free Zone, Tarkwa Bay, Lagos.
“A declaration that the Egina FPSO Project contract was also awarded by Total to Samsung on the basis inter alia of Samsung’s representations and assurances to the Nigerian regulatory authorities that Samsung would build and operate training Facility in the LADOL Free Zone for the training and education of Nigerians.
“A declaration that the Egina FPSO Project contract was bided for and obtained by Samsung on the basis of a joint venture and/or arrangement between Samsung and LADOL for the development, construction and operation of an offshore fabrication yard and FPSO integration facilities in the LADOL Free Zone for the purposes, amongst others, of the Egina FPSO Project (Joint Arrangement).
“A declaration that having bided for and represented to the Nigerian regulators that LADOL was its local content partner and on the basis of the Joint Arrangement, obtained the award of the Egina FPSO Project contract, it is not open to Total and Samsung unilaterally to exclude LADOL from the execution of the said contract.”
Also joined in the suit before Justice Aneke are Total Upstream Nigeria Limited (Total), Nigerian Content Monitoring Board (NCDMB), and the Minister of Petroleum Resources.
Other reliefs include, “an order, pursuant to section 68 of the Nigerian Content Act, cancelling the Egina FPSO Project contract, on the basis that the purported exclusion of LADOL from the performance/execution of the Egina FPSO Project contract and Samsung’s failure to build a training school in Nigeria (as it had promised it would) are a violation of the Nigerian National Content law.”
The company also seeks a disqualification of Samsung from bidding for or participating in any capacity whatsoever in any projects, operations, contracts or subcontracts in the Nigerian oil and gas sector.
While appealing to the court to restrain the defendants from excluding it from the execution of the Egina FPSO Project contract, LADOL further wants the Nigerian authorities similarly restrained from approving any other person as the Nigerian local content partner or local content solution of Samsung in respect of the work scope (fabrication of steel structures and integration of the FPSO topsides) allocated to it in respect of the Egina FPSO Project.
At a hearing of the case on January 24, Justice Aneke ordered the parties to maintain the status quo and not to take any steps to replace LADOL as the local partner of Samsung on the Egina FPSO Project pending the hearing and determination of LADOL’s application for interlocutory injunctions, which is slated for February 7.
The $3.8 billion Egina project located 130 kilometers offshore, was conceived by Total Upstream Nigeria Limited in collaboration with the NNPC, and is expected to take off by the end of 2017.
The Egina platform would be the first of its kind in Africa with a projected production capacity of 200,000 barrels per day (b/d) and a storage capacity of 2.3 million barrels.
[Ejiofor Alike, This Day]