Supreme Court Returns FPSO Tamara Tokoni to GHL

The Supreme Court has ordered the immediate handover of the crude oil aboard the Floating Production Storage and Offloading (FPSO) vessel Tamara Tokoni to General Hydrocarbons Limited (GHL), ending a prolonged legal dispute over the custody of the cargo.In a unanimous judgement delivered on Friday, the apex court also set aside the earlier decision of the Court of Appeal, holding that the dispute between GHL and FirstBank arose from a contractual relationship and did not fall within the scope of admiralty jurisdiction. The court consequently declared the proceedings before the Federal High Court and the Court of Appeal on the matter to be without jurisdiction.The judgment effectively nullifies previous orders that led to the arrest and preservation of the crude cargo pending the determination of the dispute. It also directs that the cargo be released immediately to General Hydrocarbons.The dispute stems from a financing arrangement between FirstBank and General Hydrocarbons. The bank had claimed that GHL owed it more than $225 million under facilities extended to the oil company and sought court orders to secure assets linked to the transaction.In January 2025, the Federal High Court in Port Harcourt granted orders authorising the arrest of the crude cargo aboard the FPSO Tamara Tokoni. The orders were obtained on the bank's application, with the court directing relevant maritime and security agencies to preserve the cargo pending the resolution of the dispute.General Hydrocarbons challenged the orders, arguing that the disagreement was essentially contractual and did not qualify as an admiralty claim capable of supporting the arrest of a vessel or cargo under Nigerian maritime law. The company maintained that the lower courts lacked jurisdiction to entertain the matter as an admiralty action.The legal battle subsequently moved through the appellate courts, producing a series of conflicting rulings over the custody of the crude oil. At one stage, the Court of Appeal ordered that the cargo be preserved through the Admiralty Marshal, with any proceeds from its sale to be held in escrow pending the determination of the substantive issues between the parties.However, in Friday's judgement, the Supreme Court held that the lower courts wrongly assumed jurisdiction over the matter. The apex court ruled that the dispute originated from contractual obligations between the parties and should not have been treated as an admiralty claim merely because it involved crude oil aboard a floating production vessel.The decision is expected to have implications for future commercial disputes involving oil assets and financing arrangements, particularly where parties seek to invoke admiralty procedures to secure claims arising from contractual relationships.The ruling also marks another chapter in the wider legal dispute between FirstBank and General Hydrocarbons, which has generated multiple court proceedings over the parties' commercial relationship. While the Supreme Court's judgement settles the question of custody of the crude cargo and jurisdiction over the admiralty proceedings, any outstanding contractual claims between the parties may still be determined through the appropriate legal processes.