Thursday, February 22, 2024

Court reinstates Araraume as NNPCL non-executive chairman

  • Awards N5bn damages against FG

A Federal High Court in Abuja has reinstated Ifeanyi Ararume as the non-executive chairman of the Nigerian National Petroleum Corporation Limited, NNPCL. Justice Inyang Ekwo, who made the pronouncement, also nullified and set aside all decisions and resolutions of the Board of the NNPCL made in the absence of Araraume from 17th January 2022 till date.

The court further awarded the sum of 5billion naira in favour of Araraume as damages for his wrongful removal and interruption of the term of office as the non-executive chairman of the NNPCL.

Araraume had filed his suit on 12 September 2022 to challenge his removal as the non-executive chairman of NNPCL about eight months earlier. The former senator sued President Muhammadu Buhari over the withdrawal of his appointment as non-executive chairman of the NNPCL contending that he was wrongfully removed.

Araraume, who was appointed to the position in September 2021, was removed shortly before the inauguration of the board of the company in January 2022. He argued that his sacking was “wrongful,” and amounted to “disruption and interruption” of the term of his office.

He said it violated various provisions of the Companies and Allied Matters (CAMA), 2020, the Petroleum Industry Act (PIA), 2021, and the company’s Memorandum and Articles of Association.

He prayed for N100 billion damages and an order reinstating him to the office. He also urged the court to set aside all the decisions the NNPC Limited’s board had taken since his wrongful removal from office.

President Buhari had in September 2021 appointed Araraume as the non-executive chairman of the NNPC Limited for a five-year term.

The appointment, by virtue of the letter dated 20 October 2021 issued to him by the Secretary to the Government of the Federation, Boss Mustapha, took effect from 21 September 2021, the date NNPC Limited was incorporated as a private company limited by the Corporate Affairs Commission (CAC).

The incorporation of the national oil company was necessitated by the coming into force of the Petroleum Industry Act, 2021, which led to the unbundling of the hitherto state oil company which had operated for decades as a public corporation.

The new board was initially scheduled to be inaugurated by President Buhari on 24 November 2021, but was suspended indefinitely without any reason offered on the eve of the scheduled event.

The presidency, on 5 January, made a fresh announcement of the appointment to the NNPC Limited’s board which showed that Araraume’s name had been replaced. Other appointees’ names remained on the list as earlier announced in September 2021. No reason was given for the replacement of Araraume’s name.

Araraume argued in his suit that the inauguration of the board on 7 January with another person named as the non-executive chairman of the company came to him as a surprise. He said he only received a letter dated 17 January informing him of the withdrawal of his appointment 10 days after the inauguration of the board.

“That no reasons whatsoever were adduced by the 1st defendant in the said letter 17th day of January 2022, warranting my purported removal or withdrawal of my appointment as the non-executive chairman of the 2nd defendant,” he wrote in his affidavit filed in support of his suit.

He said he had assumed duty as the non-executive chairman of the company on 12 November 2021, and, in that capacity, subsequently attended the 23rd World Petroleum Congress at Houston, Texas in the United States.

Having been appointed, Araraume argued, inauguration was “merely a ceremonial event” with no legal effect on his status and that of the other directors.

He said President Buhari lacked the power to remove him at will as his office was governed by the Companies and Allied Matters, 2020, the Petroleum Industry Act, 2021, and the company’s Memorandum and Articles of Association.

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