A divestment deal worth $2.8 billion between Shell Petroleum Development Company Limited (SPDC) and some indigenous Nigerian companies has been grounded as host communities impacted by the deal dragged the company to court claiming breach of Mareva Injunction.

According to Sewell & Kettle Lawyers, “A Mareva injunction, also known as a freezing or asset protection order is a type of interlocutory injunction which prevents a defendant/respondent from dealing with the whole or part of their assets (i.e. by moving assets abroad or dissipating them) while legal proceedings are ongoing”.

A legal practitioner, Mohammed Ndarani, SAN has filed a claim of N500 billion against Shell on behalf of over 1,216 residents of host communities for breach of a subsisting “Mareva” injunction.

In the suit filed at the Federal High Court in Abuja with number: FHC/ABJ/cs/1300/2024, the communities claimed that the recent transaction between Shell and Renaissance Consortium is a clear breach of the subsisting Mareva injunction granted by the Federal High Court, Akure on Thursday, September 28, 2023.

The injunction restrained Shell from disposing of its assets in Nigeria until the conclusion of the case.

The communities are also seeking a perpetual injunction restraining Shell, Renaissance and any other intending investors from entering any further negotiations towards the disposal of the said assets in breach of the injunction.

They prayed the court to order Shell to within 48 hours of the delivery of judgment in this suit, pay the sum of N500 billion as damages and another N5 billion as the cost of prosecuting the suit and legal representation.

The host communities, who sad that they are fish farmers, claimed that they suffered a great loss of properties due to the incessant incidents of oil spillage occasioned by ruptured pipelines belonging to Shell.

The claimants are also seeking a perpetual injunction restraining Shell, Renaissance and any other intending investors from entering into any further negotiations towards the disposal of the said assets.

SPDC JV, which operates 15 onshore and three shallow-water oil mining leases in Nigeria, had earlier this year moved to sell its assets to Renaissance. Renaissance is a consortium of ND Western, Aradel Energy, First E&P, Waltersmith, and Petrolin.

The deal is valued at $1.3 billion, with an additional $1.1billion in potential payments related to receivables and cash balances.

The net book value of the assets is $2.8 billion as at December 31, 2023, and further contingent payments were expected, depending on business performance and product price fluctuations.