Court Nullifies Reps’ N72.6bn Payout Order Against Seplat Unit
A Federal High Court in Lagos has struck down the House of Representatives’ directive compelling Seplat Energy Producing Nigeria Unlimited (SEPNU) to pay N72.624 billion as compensation to host communities over alleged oil spills, ruling that the National Assembly overstepped its constitutional boundaries and encroached on powers reserved for the courts.
Justice Allagoa delivered the judgment on Monday in Suit No. FHC/LAG/CS/862/2026, filed as Seplat Energy Producing Nigeria Unlimited v. House of Representatives, granting every relief the company sought. The court held that determining civil liability and awarding damages fall exclusively within judicial authority, and that the legislature cannot assume that role under the guise of an investigation.
The dispute stemmed from a House report of November 14, 2025, conveyed through a letter from the Clerk to the National Assembly, which found the company liable for spill related damage and directed it to settle the sum in instalments based on valuation reports. The resolution also summoned the firm’s Managing Director/Chief Executive Officer before several House committees.
Counsel to Seplat, Augustine Okafor, argued that the determination of liability for alleged civil wrongs and the award of compensation are matters the 1999 Constitution places solely before courts of competent jurisdiction. No legal representative appeared for the House throughout the proceedings.
Agreeing with the company, the court declared the directive unconstitutional, null and void, and interpreted Sections 4(1), 6(6)(b), 88(2) and 251(1)(n) of the Constitution to affirm that only the courts may pronounce on civil liability. Justice Allagoa held that while lawmakers possess investigative powers, those powers do not extend to adjudicating disputes or imposing financial penalties on individuals or corporate bodies. Section 88 of the Constitution confines legislative inquiries to matters of lawmaking or the exposure of corruption and inefficiency, not the settlement of private claims.
The ruling lands on a company at the centre of Nigeria’s shifting oil landscape. SEPNU is the former Mobil Producing Nigeria Unlimited, which Seplat Energy acquired from ExxonMobil in a transaction completed on December 12, 2024, at a final consideration of 800 million dollars, revised from the 1.283 billion dollars first announced in 2022. The deal more than doubled Seplat’s output to about 120,000 barrels of oil equivalent per day and lifted its proven and probable reserves by roughly 85 percent to 886 million barrels of oil equivalent. Seplat, listed on both the Nigerian Exchange and the London Stock Exchange, remains the country’s largest indigenous energy producer.
Oil spills remain a combustible issue across the Niger Delta, where the argument over liability and compensation is decades old. Figures from the National Oil Spill Detection and Response Agency show the region recorded about 589 spills in 2024, with later monitoring data putting incidents at 1,170 that year and 463 in 2025, alongside 140 incidents in the first half of 2026. The agency has attributed the majority, roughly 84 percent of cases between 2021 and 2024, to sabotage and crude theft rather than operational failure, a distinction that often shapes who bears responsibility.
Monday’s decision follows a run of judgments favouring the operator. In May 2026, courts in Uyo dismissed a N20.9 billion suit and a separate N50 billion claim against the company, the latter turning on Section 11(5) of the Oil Pipelines Act, which governs pipeline compensation. Taken together, the rulings reinforce a consistent judicial message that damages claims must be tested through litigation rather than legislative fiat.
Whether the House of Representatives will appeal remains unclear, as it entered no defence at the hearing. For now, the judgment sharpens the boundary between the powers of parliament and those of the bench, a line Nigerian courts have repeatedly guarded.