The Nigerian National Petroleum Company Limited (NNPCL) has achieved a significant arbitration victory. A tribunal recently ordered TotalEnergies EP Nigeria Limited to pay the national oil company $285.2 million. TotalEnergies must also cover legal costs amounting to $343,191.88 and ₦112,500,000.

This payment resolves a long-running dispute. It relates to the Amenam/Kpono Carry Agreement, signed on June 7, 2000. The core issue was NNPCL’s right to end the deal. It also concerned TotalEnergies’ subsequent entitlements to lift oil.

The arbitration began in 2015. It focused on whether TotalEnergies could continue lifting oil. This was after NNPCL had fully repaid all associated costs. Sources close to the transaction confirmed NNPCL’s full repayment. By December 2007, NNPCL had settled the Carry Capital Cost of $697.2 million. It also paid the agreed interest of $281 million.

Investigations revealed details of the agreement. It covered 492 million barrels of shared oil. The assumed price for this oil was $17 per barrel. With repayment complete, NNPCL argued TotalEnergies had no right to continued oil lifting. Consequently, NNPCL filed a counterclaim. It aimed to recover the overlifted oil.

TotalEnergies presented a counter-argument. They claimed the Carry Agreement functioned like a Production Sharing Contract. Under this arrangement, TotalEnergies bore exploration and production risks. In return, they expected a pre-agreed recovery of shared oil. The tribunal, however, rejected this argument.

The tribunal’s directive is clear. TotalEnergies must pay NNPCL $285.2 million. They also have to cover the specified legal costs. These payments are due within 14 days of the ruling. This marks a substantial win for NNPCL.

Despite the ruling, the legal battle may not be over. TotalEnergies has challenged the award. They filed this challenge in the Federal High Court. Meanwhile, NNPCL is working to ensure the ruling’s recognition and enforcement. This indicates continued legal proceedings are likely.