NESTOIL Limited has repaid $100 million to a consortium of 8 financial institutions following negotiations brokered by the Economic and Financial Crimes Commission (EFCC), offering some relief to lenders pursuing the oil and gas company over more than $1 billion in outstanding obligations.
The latest payment of $40 million was made on October 19, following an earlier $60 million repayment in August, bringing the company’s total repayments under the arrangement to $100 million, according to a report by Premium Times.
The payments form part of a structured repayment agreement negotiated between Nestoil, its affiliate, Neconde Energy Limited, and the creditor banks under the intervention of EFCC Chairman, Olanipekun Olukoyede.
The development represents progress in a debt recovery dispute that has involved some of Nigeria’s biggest financial institutions, triggered prolonged litigation and resulted in the sealing of Nestoil’s corporate headquarters in Lagos.
The 8 lenders involved are First Bank, United Bank for Africa, Access Bank, Zenith Bank, Ecobank, First City Monument Bank, Union Bank of Nigeria and the African Export-Import Bank.
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Among the institutions are banks associated with prominent Nigerian business figures. FirstBank’s parent company, First HoldCo, is chaired by Femi Otedola, while UBA was previously chaired by Tony Elumelu. Zenith Bank was founded by Jim Ovia.
However, the obligations are owed to the lending institutions and not to the individual businessmen.
How the Nestoil debt dispute began
The dispute originated from credit facilities obtained by Nestoil from Nigerian banks from 2010 to finance its oil and gas operations and investments.
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A significant part of the financing was linked to Neconde Energy, which acquired a 45 percent interest in Oil Mining Lease 42 (OML 42) in the Niger Delta for $585 million in 2011.
Despite a loan restructuring arrangement reached in 2023, the lenders alleged that Nestoil and Neconde failed to meet their repayment obligations, prompting legal action to recover the outstanding facilities.
By June 2026, the creditor consortium put the companies’ indebtedness at $1.08 billion and N469.43 billion, equivalent to approximately $348.6 million. Nestoil and its affiliates have disputed the lenders’ claims.
The disagreement subsequently developed into a prolonged legal battle over debt recovery and control of the companies’ assets.
Court battle escalated over Nestoil assets
The dispute intensified in October 2025 when the Federal High Court Lagos authorised the appointment of a receiver-manager over identified company assets as part of the lenders’ recovery efforts.
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A subsequent ruling by another federal high court judge revoked the receivership enforcement order. However, the lenders challenged the decision and obtained a fresh injunction supporting the receiver-manager’s authority.
The matter eventually reached the Supreme Court in June 2026, when the apex court overturned interim orders issued by the Court of Appeal, paving the way for the reopening of Nestoil Tower after more than seven months of restricted access.
The ruling, however, did not settle the underlying financial dispute or extinguish the lenders’ claims against the companies.
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Banks pursue recovery as EFCC brokers repayment
The debt exposure has attracted attention because of its potential implications for some of Nigeria’s major banks, particularly as lenders continue to manage non-performing loans (NPLs) and strengthen their balance sheets.
First HoldCo Chairman, Femi Otedola, had previously criticised borrowers who obtain bank facilities without honouring their repayment obligations.
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In an August 2026 interview with Nairametrics, he spoke about the need for borrowers to meet their financial commitments as banks pursue the recovery of outstanding loans.
The EFCC’s intervention subsequently brought the parties into negotiations, producing the repayment arrangement under which the consortium has so far recovered $100m.
Although the payments represent progress, the amount recovered remains relatively small compared with the debt figures presented by the lenders.
The outstanding obligations remain subject to the terms of the repayment agreement and the continuing dispute between the parties.
The EFCC investigation is also ongoing, although the agency has not announced a final settlement date or disclosed specific penalties relating to the repayment arrangement.
Nestoil and Neconde maintain that the disagreement concerns commercial lending obligations and have rejected allegations of criminal wrongdoing.
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The latest repayment therefore offers some movement towards resolving one of Nigeria’s prominent corporate debt disputes, but the recovery process remains far from concluded.
