GTBANK Dispute: Risqua Murtala Mohammed,AMG Petroenergy says widespread media reports orchestrated

Son of former Head of State, Risqua Murtala Mohammed, has said that there were ulterior motives in the orchestrated widespread media reports, of a routine commercial dispute between his company and the Guaranty Trust Bank.

A Federal High Court was quoted by some national dailies to have barred Risqua Mohammed from withdrawing funds from his accounts in any of the financial institutions in the country for allegedly failing to liquidate a N1.365 billion credit facility.

A statement on Wednesday by the Counsel to Mohammed’s company, AMG Petroenergy Limited, said the Court order was an incidence common in commercial disputes, wondering why this particular case generated huge attention.

“It is a fact that a Judge of the Federal High Court granted various orders restraining our aforementioned clients from operating their bank accounts,” it said.

“As the orders were granted ex parte, it is only upon further hearing that our clients will be afforded the opportunity of being heard in the advancement of their interests in the case.”

Clarifying the matter, Consolex Legal Practitioners confirmed that there currently exists an unresolved payment dispute between AMG and Total which has resulted in suit between AMG and Anor V. Total Nigeria limited.

It explained that AMG entered into a contractual arrangement with Total Nigeria for the supply of Premium Motor Spirit under the Petroleum Support Fund (PSF) Scheme, while Guaranty Trust Bank Limited, on behalf of AMG, financed the transaction.

“The repayment of the facility was to be made from “subsidy” payments received from the federal government. AMG duly supplied the products as contractually agreed to Total between December 29, 2011, and January 1, 2012. “

In his reaction, Group Chief Operations Officer of AMG Petroenergy Limited, Ibrahim Baloni, explained that under the Scheme, importers of PMS, authorised by the federal government through its agency, the Petroleum Products Pricing Regulatory Agency (PPPRA) were entitled to look to the federal government for all short-falls (“under-recoveries”).

This, he said, is sustained by them by virtue of their having sold (directly or indirectly) their imported PMS at the regulated “ex-depot” price in the event that such sale(s) was/were at a price lower than the “landing cost” of the product as approved/recognized by PPPRA.

Continuing, Baloni said: “In order to achieve the importation of the said 15,000 MT of PMS, our Company drew down on an Import Facility granted to it by Guaranty Trust Bank Plc, vide Offer of Facility letter dated May 18, 2011, through the establishment of a $15,562,807.15 (Fifteen Million, Five Hundred and Sixty-two Thousand, Eight Hundred and Seven Dollars Fifteen Cents) Letter of Credit.

“It was a term of the said offer of Facility letter that the facility shall be repaid from the proceeds of the transactions for which the funds were to be utilized vide the domiciliation of sales proceeds.

“On 1st January, 2012, the Federal Government of Nigeria announced changes in its policy of subsidizing the importation of PMS under the PSF Scheme pursuant to which the subject PMS was imported and sold to Total.

“Between 1st January, 2012 and 16th January, 2012, the Federal Government totally withdrew its erstwhile subsidization of the importation of PMS and from 17th January, 2012, the Federal Government re-introduced the said subsidization (the PSF Scheme) but to a reduced extent.”

The official added that AMG Petroenergy Limited legal representatives have been instructed to make its position clear to the Court and seek redress there for the unprecedented negative publicity provided by its Orders under reference.

Here is a full statement by Risqua’s Company

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We are constrained to make this statement in view of various publications in respect of a slew of Orders made ex parte (ie in our absence and without hearing our side) by the Federal High Court of Nigeria sitting in Lagos on 15th October, 2014. The Orders were made pursuant to Claims brought before that Court by Guaranty Trust Bank Plc seeking to recover monies from our Company, AMG PETROENERGY LIMITED and it’s Managing Director, Mr. Risqua Murtala Muhammed.

THE FACTS AS THEY ARE:

Our Company, pursuant to an agreement with TOTAL NIGERIA PLC (“Total”) for the purchase of Premium Motor Spirit (“PMS”), imported 15,000 MT (Fifteen Thousand Metric Tonnes) of PMS. The 15,000 MT (22,018.244 Litres) of PMS was duly delivered to the designated Total depot between 29th December, 2011 and 1st January, 2012 at the price of N53.50/Ltr, pursuant to its expected sale at the government regulated ex-depot price of N55.90/Ltr. The said supply to Total was made under the Petroleum Support Fund (“PSF”) Scheme of the Federal Government of Nigeria as it operated at the time of our Company’s transaction with Total.

Under the aforementioned Scheme, importers of PMS, authorized by the Federal Government through its Agency, the Petroleum Products Pricing Regulatory Agency (“PPPRA”) were entitled to look to the Federal Government of Nigeria for all short-falls (“under-recoveries”) sustained by them by virtue of their having sold (directly or indirectly) their imported PMS at the regulated “ex-depot” price, in the event that such sale(s) was/were at a price lower than the “landing cost” of the product as approved/recognized by PPPRA.

In order to achieve the importation of the said 15,000 MT of PMS, our Company drew down on an Import Facility granted to it by Guaranty Trust Bank Plc, vide Offer of Facility letter dated May 18, 2011, through the establishment of a $15,562,807.15 (Fifteen Million, Five Hundred and Sixty-two Thousand, Eight Hundred and Seven Dollars Fifteen Cents) Letter of Credit. It was a term of the said offer of Facility letter that the facility shall be repaid from the proceeds of the transactions for which the funds were to be utilized vide the domiciliation of sales proceeds.

On 1st January, 2012, the Federal Government of Nigeria announced changes in its policy of subsidizing the importation of PMS under the PSF Scheme pursuant to which the subject PMS was imported and sold to Total. Between 1st January, 2012 and 16th January, 2012, the Federal Government totally withdrew its erstwhile subsidization of the importation of PMS and from 17th January, 2012, the Federal Government re-introduced the said subsidization (the PSF Scheme) but to a reduced extent.

Consequent upon the changes in government policy referred to above, the ex-depot prices of PMS at which Total sold and/or “trucked-out” the PMS supplied to it by our Company, are as follows, on the relevant dates shown below:

Between 1st January, 2012 and 16th January, 2012:N141.00 per litre, or thereabouts (i.e. above the PPPRA-recognised landing cost of N122.56 per litre.

Between 17th January, 2012 and 26th July 2012: N81.51 per litre, being the official truck-out price introduced upon reinstatement of government’s subsidization policy.

The dates are significant because between those dates, Total trucked-out for sale, the following quantities of the PMS supplied to it by our company pursuant to the PSF Scheme:

1st January, 2012 to 16th January, 2012: 9,760,372 litres.
17th January, 2012 to 26th January, 2012: 12,257,871 litres.

It is worthy of note that the recognized landing cost of PMS at the material time (on the Mother Vessel Bill of Lading date) when the cargo was received by Total at N53.50 per litre, was N122.56 per litre.

Accordingly, Total realized an “additional” income in respect of the subject cargo of PMS, in the total sum of N964,550,474 (Nine Hundred and Sixty-four Million, Five Hundred and Fifty Thousand, Four Hundred and Seventy-four Naira).

As a marketer of PMS, and being, itself, an importer of PMS under the PSF Scheme, Total knew or ought to have known that the imported PMS was ONLY sold to it at N53.50 per litre under the PSF Scheme on the premise that the official ex-depot price of N55.90 per litre would apply thereto, whereupon our Company would look to the Federal Government (through the PPPRA) for the realization of any under-recoveries sustained as a consequence of the said sale, with the said ex-depot price of N55.90 per litre operating as the base.

As such, the above-stated sum of N964,550,474 (Nine Hundred and Sixty-Four Million, Five Hundred and Fifty Thousand, Four Hundred and Seventy-Four Naira), realized and retained by Total, ought to be paid by Total to our Company since the Federal Government will not reimburse us for monies which have benefitted Total at the expense of Nigerians who are the ones intended to benefit from its Policy under which any claims for such monies would ordinarily arise.

The Federal Government, in January, 2014, paid the sum of N503,185,645.60 (Five Hundred and Three Million, One Hundred and Eighty-Five Thousand, Six Hundred and Forty-Five Naira, Sixty Kobo) to our Company, through Guaranty Trust Bank, to cover a portion of the under-recovery sustained on the subject cargo after the reinstatement of the subsidization policy on 17th January, 2012.

The said payment was, however, made only to the extent that Total did not benefit at the expense of Nigerians, as aforementioned. As such, though our indebtedness to the bank was reduced by the said amount, its realization still left our Company exposed for the earlier stated sum of N964,550,474 (Nine Hundred and Sixty-Four Million, Five Hundred and Fifty Thousand, Four Hundred and Seventy-Four Naira) and accrued interest.

Total, despite several demands made to it by our Company to reimburse us with the above stated sum, blatantly refuses to do so. Consequently, our Company was constrained to institute an action at the High Court of Lagos State against Total in Suit No. LD/ADR/256/2013: AMG Petroenergy Limited & Downstream Energy Source Limited V. Total Nigeria Plc, wherein we seek to recover the “additional” income it made at the expense of our Company.

Notwithstanding the said Suit against Total, our Company continues to appeal to the PPPRA, as industry regulator, to come to our aid in addressing the issue with Total, in order that justice is achieved and our Company (and, ultimately, Guaranty Trust Bank) is reimbursed by Total with the above stated sum, in order to avoid going through the full length of a cumbersome litigation process.

In summary, it is these matters that have resulted in the Orders made by the Federal High Court. Our Company has consistently kept Guaranty Trust Bank aware of the efforts being made to secure payment as indicated above and, of course, that the monies it borrowed were utilized for no purpose other than that for which they were provided. Needless to say, our legal representatives have been instructed to, once provided with the opportunity, make our position clear to the Court and seek redress there for the unprecedented negative publicity provided by its Orders under reference.