For the past four years, the story of the Dawes Island marginal field was told as a simple parable of reform: A dormant asset, idle for 17 years, was finally revoked from a failed operator and handed to a capable Nigerian champion who drilled, produced, and paid royalties.
This was a narrative championed by the African Energy Chamber (AEC), Ministerial delegations, and Petralon 54 Limited. It featured wellhead visits, production targets, and praise for the “drill or drop” policy.
It was also, according to the Federal High Court of Nigeria, illegal.
On 29 January 2026, Justice A.O. Awogboro of the Federal High Court in the Lagos Judicial Division in suit number: FHC/L/CS/628/2021 delivered a judgment that did more than reverse a license revocation. It tore the veil off one of the most contentious asset transfers in Nigeria’s upstream sector, declaring the 2020 revocation of the Dawes Island license unlawful, the subsequent award to Petralon null and void, and ordering the reinstatement of Eurafric Energy Limited as the lawful awardee.
Yet rather than address the 84-page judgment, the African Energy Chamber issued a press release accusing the judiciary of “overreach.”
A review of court documents, parliamentary records, and transactional evidence obtained by this publication suggests the only overreach occurring was administrative and that the AEC’s defense of Petralon omits critical facts regarding secret oil sales, abandoned arbitration, and diverted revenues.
The History That Was Erased
The AEC’s narrative begins in 2022, when Petralon purportedly “rescued” Dawes Island.
Court records, however, trace the fault line to 2018.
Contrary to claims of dormancy, the Dawes Island Joint Venture (JV) comprising Eurafric Energy and Petralon was actively developing the asset. The DI-1 well was re-entered and side-tracked. Extended Well Tests were conducted. Production peaked at approximately 4,000 barrels per day.
Total crude oil produced: 62,000 barrels.
The AEC recently dismissed this 62,000 barrels as mere “technical evaluation” rather than commercial production.
Yet according to industry definitions, crude oil that is extracted, processed, stored, evacuated, and sold does not constitute a geology test. It constitutes commerce.
“If 62,000 barrels of oil lifted to a floating production vessel is not production, the English language has lost its meaning,” a senior Lagos-based energy counsel, not involved in the suit, disclosed
The 30,000 Barrel Discrepancy
More damaging than the semantic debate is the forensic trail regarding the proceeds of that oil.
Following production, the JV crude was evacuated to the FPSO Tamara Nanaye. Approximately 30,000 barrels were lifted. The remainder stayed in storage.
According to affidavits filed before the court and seen by this publication, Petralon subsequently evacuated and sold the 62,000 barrels without transparent disclosure to Eurafric. Despite repeated formal demands, Petralon has reportedly failed to account for the full volume.
Of the 62,000 barrels produced, Petralon has to date only accounted for 29,025 barrels. The balance and the proceeds derived there from remain unexplained.
Sales proceeds were diverted into Petralon’s accounts, contrary to the joint evacuation mandate governing the JV. Those funds remain withheld, despite pending orders compelling disclosure.
“This is not a dispute about regulatory policy,” said a source close to Eurafric. “This is a dispute about diverted partnership assets.”
The Petition No One Saw
The administrative mechanics of the revocation are equally troubling.
In 2018, Petralon submitted a petition to the Honourable Minister of Petroleum Resources alleging misconduct by its own JV partner, Eurafric.
Eurafric was never notified of the petition. It was granted no right of reply.
Two years later, the license was revoked. Petralon, which had co-signed the very JV operating agreements, was subsequently awarded the field exclusively.
The House of Representatives Committee on Public Petitions examined this sequence. Its findings were damning. The Committee described the award to Petralon alone as “inequitable, suspicious, and irregular,” recommending the reinstatement of the original JV.
The AEC’s press release did not mention the parliamentary inquiry.
Arbitration: Started, Challenged, Abandoned
The AEC portrays Petralon as a compliant investor following “every rule.” Court records suggest a more strategic litigation history.
In January 2021, Petralon initiated arbitration proceedings against Eurafric. It subsequently challenged the arbitral tribunal, withdrew counsel, and ultimately abandoned the process entirely but only after securing administrative control of the field.
“The pattern is coherent. Seek administrative revocation, bypass the joint venture structure, sideline the partner, then criticize the courts for restoring status quo ante,” Melvin Daminabo, a lawyer familiar with the case volunteered.
THE $18 MILLION FLAW IN THE ‘DRILL OR DROP’ STORY
The AEC emphasizes Petralon’s $60 million post-award investment as proof of its bona fides.
What the narrative omits is the capital that came before.
- Eurafric funded 100% of all costs prior to the farm-in.
- Post-re-entry, Eurafric funded 51% of joint expenses.
- Direct and contingent liabilities exceeded $18 million.
- Following the unlawful revocation, Eurafric bore 100% of security and preservation costs alone, including protecting the stored crude.
“Capital expenditure does not cure a defective title,” the Court reportedly reasoned. Operational effort cannot legitimize a foundation the judiciary has declared void.
If Dawes Island is now producing, it is producing atop a decade of Eurafric’s seismic processing, community engagement, infrastructure mobilization, and drilling campaigns, much of which was funded, documented, and paid for prior to 2022.
The ‘Judicial Overreach’ Fallacy
The AEC’s primary criticism is that the Federal High Court engaged in “judicial overreach” by reviewing the Minister’s revocation decision.
This proposition that executive decisions regarding petroleum licenses should be immune from judicial scrutiny has alarmed constitutional lawyers.
“If the Minister revokes a license without complying with the governing Act, and a court cannot review that action, there is no rule of law.
There is only administrative discretion. No IOC or independent would accept those terms of engagement,” John Owubokiri, another senior lawyer with over 30 years of legal practice, pointed out.
The Court’s judgment was not an activism-driven land grab. It was a statutory interpretation exercise addressing whether the 2020 revocation complied with the 1969 Act and DPR guidelines in force at the time.
The Court found it did not.
The Petralon Defense: Capable Operator, Defective Title
This article does not dispute Petralon’s operational capability. Following the award, the company drilled two wells and connected infrastructure.
But as the Court affirmed: operational capability does not supersede legality.
If the revocation was void, the award was void. If the award was void, the Petroleum Prospecting License (PPL 259) derived therefrom is void. If the root is rotten, the fruit falls with it.
The AEC warns that reinstating Eurafric undermines “investor confidence.”
The counter-argument, endorsed implicitly by the Court, is that investor confidence is not built on the security of expropriation, but on the security of contract.
“Sophisticated capital fled Nigeria not because courts enforce contracts, but because for decades they did not,” a banking source noted. “A court that restores unlawfully taken property is not a threat. It is an insurance policy.”
Petralon has indicated it will appeal. A stay of execution is pending.
But the evidentiary record, the 62,000 barrels, the secret petition, the missing 30,000 barrels of oil, the abandoned arbitration, the parliamentary censure, and the $18 million in pre-revocation funding is now part of the public domain.
The African Energy Chamber may continue to frame this as a contest between “reformers” and “incumbents.”
But the Federal High Court has framed it differently: as a contest between administrative power and constitutional due process.
Press releases cannot erase production history. They cannot rewrite judicial findings. They cannot explain where 30,000 barrels of Joint Venture crude went, or why its proceeds remain withheld.
On Dawes Island, the record stands.
And for the first time in four years, the law stands with it.
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