Seplat Resolves Dispute With Access Bank

Lagos, October 27 (Energy Voice Aberdeen) – Seplat Energy has resolved its dispute with Access Bank over Cardinal Drilling Services by buying four rigs.

Access Bank had provided a loan to Cardinal for four drilling rigs, used by Seplat.

Cardinal became unable to pay its debts in 2019 and the bank appointed a receiver. The bank considered Seplat to be partly responsible for meeting Cardinal’s obligations.

It secured an injunction sealing Seplat’s Lagos headquarters and some of its bank accounts in December 2020. Seplat was unable to access its offices for a month until a court suspended the order.

Seplat denied that it should play a part in the litigation as it was neither a shareholder in Cardinal nor had it made any guarantees for the company.

While this position remains unchanged, Seplat has come to see the risk of legal action as too great. Access Bank was taking the dispute to the Supreme Court. Had the bank won, Seplat could have faced “significant disruption” to its work, including the closure of its offices and freezing of bank accounts.

In order to avoid this scenario, Seplat has agreed to buy the four drilling rigs from the Cardinal receiver for $36 million. The company said this should reduce costs, but also it brings an end to the legal action.

Cardinal had owed Access Bank $86mn.

Related Posts