OPL 471 dispute: Court orders Chinese oil firm to pay $100m

The Federal High Court sitting in Port Harcourt has upheld its earlier judgment ordering China National Petroleum Corporation to pay the sum of $100m to Cutra International Limited over the disputed Oil Prospecting Licence 471, dismissing the Chinese oil giant’s bid to overturn the decision.

Justice Adamu Mohammed, in a ruling delivered on April 24, 2026, dismissed CNPC’s application seeking to set aside the court’s May 23, 2025 judgment, holding that the issues raised had already been determined and that the court had become functus officio.

“At this juncture, it is to be noted that, when a court takes a position on a matter in controversy before it, that court becomes functus officio with respect to that matter in controversy, and the court stands and remains bound by the decision,” Justice Mohammed held in the judgement,  a copy of which was sighted by our correspondent.

The dispute arose from OPL 471, an oil block awarded during Nigeria’s 2006 mini-bid round.

In its substantive judgment delivered on May 23, 2025, the court held that Cutra International was entitled to a 10 per cent equity stake in the oil block as the designated local content vehicle under the award letter issued by the Ministry of Petroleum Resources on June 29, 2006.

The court found that CNPC unlawfully returned the oil block to the Federal Government on November 1, 2015, without Cutra’s knowledge or consent, thereby violating the Nigerian company’s proprietary rights.

“Having carefully perused and considered the letter dated 29th June, 2006, being Exhibit A attached to the affidavit in support, I have indeed found that, by that letter, the Plaintiff was the local content vehicle for OPL 471 and the equity participation for the Plaintiff is 10 per cent. I so hold,” the judge ruled in the earlier judgment.

Justice Mohammed further declared that the Ministry of Petroleum Resources had awarded the oil block jointly to both parties.

“In my view, the Plaintiff has proved that the Ministry of Petroleum Resources awarded OPL 471 to both the Plaintiff and the Defendant and the equity participation of 10 per cent in favour of the Plaintiff,” he held.

Cutra had sought $500m in damages, arguing that the amount represented its projected minimum earnings from the block.

Although the court held that portions of the claim were not strictly proved, it awarded $100m in damages.

“In the light of the foregoing, what I assess and find reasonable is to award the sum of USD$100,000,000.00 in favour of the Plaintiff against the Defendant. I so hold,” Justice Mohammed said.

CNPC subsequently filed an application on October 28, 2025, asking the court to extend time to challenge the judgment, vacate orders for substituted service, strike out the originating summons and dismiss the suit.

The corporation argued that it was denied fair hearing because it was never properly served and only became aware of the judgment after garnishee proceedings were initiated against its accounts.

It also contended that the originating summons had expired and that, as a foreign company, it ought to have been served through diplomatic channels.

However, Cutra opposed the application, insisting that CNPC had been served repeatedly through DHL courier, email and newspaper publication.

Justice Mohammed agreed, reaffirming that the company had been properly served but failed to defend the action.

“From the record before the Court I can confirm that the Originating Summons and hearing notices were served on the defendant vide courier service, emails and publication on national dailies, but the defendant did not file any response or appear before the Court,” he said.

On CNPC’s fair hearing argument, the court was unequivocal.

“The grounds raised on the issue of service of the originating processes and/or denial of fair hearing cannot stand or be revisited by this Court, having confirmed and held that the originating summons and hearing notices were served on the Applicant in my judgment of 23 May, 2025,” the judge ruled.

The court also dismissed the argument that the originating summons had expired.

“For the avoidance of any doubt, by the order of this Court made on the 10th of May, 2024, renewing the originating summons filed by the Respondent in this suit, the ground that the originating summons had expired can’t stand and is hereby discountenanced,” Justice Mohammed held.

Addressing CNPC’s argument that service ought to have been effected through diplomatic channels under Order 6 Rule 20 of the Federal High Court Rules, the judge held that the rule only applies where there is an existing convention between Nigeria and the foreign country concerned.

“In the instant case, the Applicant did not show that there is a convention in that behalf between Nigeria and the country of the Respondent. I so hold,” he ruled.

While dismissing the application in its entirety, Justice Mohammed concluded,“Based on the foregoing decisions of this Court, I am of the view that it will not be in the interest of justice to grant any of the reliefs sought in the instant application and is accordingly dismissed.”

The decision leaves intact the $100 m judgment in favour of Cutra International and paves the way for the company to continue garnishee proceedings to enforce the award against CNPC.(Punch)