Tuesday, January 24, 2006

Offor Unit Faces $1 Million Judgment In Nigerian Court

A company headed by ERHC Energy CEO Sir Emeka Offor apparently has a new problem to present the embattled billionaire who owns the controlling interest in ERHC Energy.

According a small Nigerian daily, The News, Offor entered into a 1998 agreement with a Romanian firm, Retrom Oil Company, and two other companies to form the Chrome Consortium to handle turnaround maintenance omn the Port Harcourt refinery. Retrom said it was paid as much as $120,000 a month as a consulting fee for only six months and that another 10 months of invoices didn't get paid.

The news story only gave the plaintiff's side of the issue; it is unclear why Chrome refused to pay the consultants.

The matter went to arbitration in Paris at the International Chamber of Commerce - the same arbitrator that supported ERHC's claim in 2001 to rights in the Nigeria and Sao Tome Joint Development Zone - and Chrome lost. In March 2001 after arbitration Chrome was ordered to pay $734,900 and interest of $148,968.

Now the judgment is worth $1,229,620.20, according to The News.

The matter was expected to be heard in Nigeria's Federal High Court in Lagos before Justice Ndagi Auta on Jan. 19.

Here is the story from The News:

Emeka Offor's Company In Trouble •Over Breach Of Contract
Published: 2006/1/19 - Read 644 times Article Rated: 0.00

A Romanian National Oil Company now known as S.C. Retrom S.A. alleged to have been shortchanged in a business contract by a Nigerian oil company Chrome Oil Services Limited owned by a Nigerian businessman Chief Emeka Offor, has commenced a legal battle against the oil company in order to enforce the judgment sum of $1,229,620.20.

According to an affidavit sworn to by Barrister Ayodeji Olomojobi and filed before a Federal High Court in Lagos, it was alleged that sometime in August 1998, Retrom Oil Company, Chrome and two other companies, Petroconsult, and Universal Montay Sarzeu, agreed to form the Chrome Consortium in order to administer, manage and execute the works of the Turn Around Maintenance (TAM) of the old and new Port Harcourt refineries. The consortium was also to carry out major rehabilitation works in both plants and total management services of the refinery.

Under the agreement, Chrome Consortium would be a partnership association, and would therefore not be registered as a legal entity and that Retrom was the technical consultant of the consortium which Chrome was the leader, legal representative and administration manager of the consortium. Retrom was also entitled to the amounts calculated based on the activities performed on the consultancy wages to the contract, but not less than $120,000 per month. Therefore, the consortium was obliged to pay the petitioner for the services specified within 10 business days of receipt of Retrom’s invoice, unless otherwise stated by the parties.

It was further agreed that any dispute between the parties shall be amicably resolved and if parties failed to agree over the said dispute then it shall be referred for arbitration under the rules of the ICC in Paris, under the law of England. Retrom was alleged to have carried out its obligations satisfactorily under the consortium agreement from March 1999 to October 2000, but only the invoice of the company from March 1999 to November 1999 was paid while Retrom was not paid for invoices submitted after December 1, 1999 and despite repeated demands, Chrome refused to pay 10 other invoices presented by Retrom.

However, in March 2001, Retrom filed a request for arbitration at the Court of Arbitration. Both Retrom and Chrome made oral and documentary submissions to Maitre Roger Benrubi, the Sole Arbitrator of the Arbitral Tribunal set up and having duly considered the documents and having heard oral arguments of respective counsels to both parties, Chrome and other members of the consortium were to pay Retrom (a) the principal amount of $734,90 (b) interest up to the date of request of arbitration $148,968, (c) interest on the principal amount.

Up till the date of making this petition, Emeka Offor’s company and other members of the consortium have refused to pay to Retrom the amounts awarded by the Arbitral Tribunal in favour of Retrom. Consequently, Retrom Company is now urging the court to make an order that it should be paid the sum of $1,229,620.20. Justice Ibrahim Ndagi Auta will today commence the hearing of the case.

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