General Hydrocarbons Limited loses arbitration against First Bank as tribunal rules FBN’s financing duties were conditional and dismisses all claims

General Hydrocarbons Limited (GHL) has lost its arbitration case against First Bank of Nigeria Limited (FBN) after the tribunal dismissed all claims brought by the energy firm, ruling that the bank’s financing obligations were conditional and not absolute.

Also read: First Bank CR&S Week 2025 Inspires Global Kindness

The Final Award, issued on 28 October 2025 by Hon. Justice Kumai Bayang Akaahs (Rtd), who served as the Sole Arbitrator, marks the conclusion of a complex financial dispute arising from a multi-million-dollar oil financing deal.

GHL was represented by Paul Usoro, SAN and Abiodun Layonu, SAN, while First Bank was represented by Gbolahan Elias, SAN, Babajide Koku, SAN, and Victor Ogude, SAN.

The dispute stemmed from a Subrogation Agreement dated 29 May 2021, under which GHL agreed to repay an outstanding debt of $718 million, while FBN undertook to provide additional financing to develop and produce OML 120, an offshore oil block.

GHL accused the bank of breaching the agreement by failing to provide full and timely funding, sabotaging alternative financing attempts, and causing significant operational and financial losses.

However, the tribunal ruled entirely in favour of First Bank, holding that its financing obligations were conditional—subject to professional evaluation, competitive terms, and regulatory discretion.

The arbitrator found that GHL failed to prove any breach, noting that FBN had made several financing offers totalling $185 million, and that the delays complained of were neither unreasonable nor in violation of the agreement.

Justice Akaahs further held that the introduction of an Independent Asset Manager as a financing condition was consistent with the Subrogation Agreement and not a breach of contract.

Allegations that FBN sabotaged GHL’s alternative funding efforts were dismissed as unsubstantiated and devoid of merit.

Consequently, all reliefs sought by GHL—including declarations, claims for damages, and termination of the Subrogation Agreement—were refused.

Also read: First Bank Building Collapse Sparks Panic in Umuahia

The tribunal ordered GHL to pay FBN’s legal and arbitration costs amounting to $112,100 and ₦111,250,000, within 30 days, with interest accruing on any delayed payment.