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Conoil investors lose N2.63bn amid firm’s poisonous gas saga

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Conoil’s 9-month profit contracts by 35% after N25bn revenue drop

Conoil investors lost 14.9 percent of their investments in the oil giants after a report emerged on November 6 that the company’s facility in Bayelsa State emitted poisonous gas.

The leakage occurred in Adriatic facilities owned by the company and operated by SHELF Oil and Gas Drilling Company Nigerian Limited platform located in Otuo South in Oil Mining Lease (OML) 59 of Sangana community, Brass local government area of the state.

Following the spill, Conoil reportedly ignored the host community, a similar situation that caused Shell, another oil and gas company, $111 million after a Dutch court found the latter guilty of 1970 oil spills in Niger Delta.

With the possibility of a lawsuit hanging on Conoil’s neck, the capital market reacted negatively to the company’s shares a week after the report with stakeholders taking out their funds from the firm.

Ripples Nigeria analysis showed that in one week, the company’s chairman, Mike Adenuga, and other shareholders lost N2.63 billion as sell-off dragged the share down by 14.9 percent from N25.5kobo to N21.7kobo per share.

READ ALSO: Conoil directors take pay cut, but increase spending on hotels, entertainment

This caused investors’ investments to crash from N17.69 billion to N15.05 billion as of November 12.

This further compounded the woes of the company which is facing potential lawsuits over its failure to pay the $7 million debt to two contractors, Depthwize, a drilling firm based in Ibadan, and Zukus Industries Limited, an oil and gas service provider.

Conoil has been owing Depthwize $6.2 million since last year and Zukus Industries Limited N317.75 million for invoices dating back to 2017.

Both companies had threatened legal actions as Conoil continued to delay payment for their services.

The oil form did not immediately respond to enquiry sent to the firm by Ripples Nigeria

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