Nearly three decades after Oil Prospecting Licence 245 first entered Nigeria’s petroleum lexicon, the controversial asset has returned to the courtroom, this time in a fresh confrontation between Malabu Oil & Gas Ltd and the Federal Government over the restructuring of one of the country’s most disputed deep-water oil blocks.
In a suit filed before the Federal High Court in Abuja, Malabu is challenging the Federal Government’s decision to split the block into four assets under a new resolution framework involving Shell Nigeria Ultra-Deep Limited, Shell Nigeria Exploration and Production Company Limited, Nigerian Agip Exploration Company Ltd, and NNPC Limited.
The company is demanding N1 trillion in damages, arguing that the government unlawfully interfered with rights it insists remain legally valid and exclusive.
At the heart of the dispute is a familiar question that has trailed OPL 245 for years: who truly controls one of Nigeria’s richest untapped offshore assets, and can the government restructure the block while ownership claims remain tied up in litigation?
Filed under Suit No. FHC/ABJ/CS/871/2026, the action names the President, the Attorney-General of the Federation, and the Minister of Petroleum Resources as defendants. Through a legal team led by Dr. R.O. Atabo (SAN), Malabu contends that the Federal Government exceeded its powers under the Petroleum Industry Act (PIA) 2021 by reallocating and converting the block while several related cases remain before the courts.
The new filing directly targets the March 2026 OPL 245 Resolution Agreement, which effectively carved the block into separate operational interests tied to major industry players and aligned with the government’s broader strategy to revive stalled deep-water investments.
For the Tinubu administration, the restructuring represents more than a legal exercise. It is part of a wider push to unlock dormant offshore assets, attract fresh capital inflows, and raise crude oil production at a time Nigeria faces mounting fiscal pressure and declining investor confidence in upstream operations.
Government officials have framed the agreement as a commercial breakthrough capable of reviving the long-delayed Zabazaba-Etan deep-water project, which officials estimate could contribute about 150,000 barrels per day to national output.
That production potential partly explains why OPL 245 remains strategically important despite years of legal turbulence spanning administrations, courts, settlements, and international investigations.
Malabu, however, argues that the latest government action amounts to executive overreach.
In a sworn affidavit, shareholder and director, Mohammed Sani Abacha, traced the company’s claim to the original allocation of OPL 245 and OPL 214 in April 1998 by the then Minister of Petroleum Resources. According to him, Malabu fulfilled all financial obligations attached to the licence, including payment of a $2.04 million signature bonus, before the licence was revoked in 2001.
That revocation triggered a legal battle which, according to Malabu, culminated in an out-of-court settlement in 2006. A central condition of that settlement, the company argues, was the restoration of OPL 245 to Malabu, eventually formalised through a reallocation letter dated July 2, 2010.
The company’s present argument rests heavily on the claim that this reallocation granted it exclusive possessory rights that have never been lawfully extinguished.
From Malabu’s perspective, the Federal Government cannot legally grant overlapping rights to other operators while those interests remain alive and subject to pending judicial proceedings.
The suit therefore seeks multiple declarations, including that the government lacked the authority under the PIA or any other statute to allocate concurrent rights over the block. It also seeks orders nullifying both the Resolution Agreement and the conversion of OPL 245 into OML 245.
A key pillar of Malabu’s case is timing.
The company argues that the conversion and restructuring occurred while several related suits and appeals were still pending before the Federal High Court, the Court of Appeal, and the Supreme Court. It contends that such actions undermine judicial authority and amount to an attempt by the executive arm to pre-empt unresolved legal questions through administrative action.
The filing also reveals how sharply interpretations differ between the government and Malabu over the intent behind the new agreement.
While Presidential Adviser on Energy, Olu Verheijen, described the settlement as a reform-driven framework aligned with the Petroleum Industry Act and capable of attracting investment into Nigeria’s deep-water sector, Malabu interprets the same policy direction as evidence of deliberate exclusion.
Likewise, comments by Bayo Ojulari that the agreement clears the path for accelerated development of the Zabazaba-Etan project are cited by Malabu as proof that the government has already proceeded as though ownership disputes no longer exist.
That tension exposes the broader dilemma facing Nigeria’s petroleum sector: balancing investor certainty and production growth against unresolved legacy disputes that continue to shadow some of the industry’s biggest assets.
The OPL 245 saga has long stood at the intersection of politics, oil economics, executive discretion, and judicial contestation. What began as a licence allocation dispute has evolved into one of the most enduring and internationally scrutinised oil block controversies in Nigeria’s history.
Now, with the Federal Government attempting to reposition the asset under a new commercial framework, the courts may once again determine whether economic urgency can override unresolved proprietary claims.
The matter is scheduled for a hearing on June 11, 2026, at the Federal High Court in Abuja.