On May 27, 2025, the Court of Appeal in Abuja dismissed Malabu Oil and Gas Ltd’s $1.3 billion claim over Oil Prospecting Licence (OPL) 245, ruling in favor of Nigerian Agip Oil Company. The decision, delivered by Justice H. A. Barka on May 23, 2025, overturned a 2020 Federal High Court ruling that had rejected Agip’s preliminary objection, labeling Malabu’s suit an “abuse of court process.” This marks a significant development in the long-standing dispute over OPL 245, a deep-water oilfield 150 km off the Niger Delta.
The legal battle stems from a 2011 “Block 245 Resolution Agreement,” under which Malabu allegedly relinquished its rights to OPL 245. On May 11, 2011, the Federal Government reallocated the block to Shell Nigeria Exploration and Production Company Ltd and Nigerian Agip Exploration Ltd, pursuant to the Petroleum Act. Malabu challenged this, claiming its prior allocation remained valid and seeking to nullify the reallocation. Agip, represented by Babatunde Fagbohunlu SAN, argued that Malabu’s suit was statute-barred, filed over five years after the allocation, and constituted an abuse of process due to a concurrent case questioning Malabu’s shareholder legitimacy.
The Federal High Court’s 2020 dismissal of Agip’s objection prompted an appeal. Agip contended that the lower court’s failure to address its jurisdictional challenges violated its right to a fair hearing. The Appeal Court agreed, dismissing Malabu’s claims against Agip, the federal government, the Minister of Petroleum Resources, Shell entities, and Chief Dan Etete. At the current exchange rate of N1,579/$1 as of May 28, 2025, the disputed $1.3 billion equates to approximately N2.05 trillion, highlighting the financial stakes of OPL 245, one of Nigeria’s most contested oil assets.
The ruling reinforces the 2011 reallocation and underscores judicial scrutiny of overlapping legal actions. However, Malabu may pursue further appeals, prolonging the saga. The decision strengthens Agip and Shell’s operational control over OPL 245, potentially boosting investor confidence in Nigeria’s oil sector, though unresolved disputes and regulatory uncertainties could temper optimism.
