Aiteo Eastern E&P Company Limited, a leading indigenous oil exploration firm founded by Nigerian billionaire oil mogul Benedict Peters in 2013, has found itself embroiled in a mounting debt crisis.
According to recent disclosures by the Nigerian subsidiary of British multinational oil company Shell Plc and seven local banks, the energy company owes a staggering $2.6 billion in oil-related loans.
This figure represents an increase of $910 million compared to its 2022 figure of $1.7 billion when Shell Plc initially reported the outstanding loans.
The lenders and Aiteo have been locked in a legal dispute since late 2019, when the creditors notified the company of its default.
The $2.6 billion debt can be traced back to Aiteo’s acquisition of a pipeline and operating interest in a highly valuable onshore oil block eight years ago.
Nigerian banks such as Zenith Bank Plc, Fidelity Bank Plc, and Guaranty Trust Bank Plc extended loans amounting to $1.5 billion to support the acquisition, while Shell provided $504 million in financing as the asset seller.
Since the initial loan agreement, Aiteo, Shell, and the Nigerian lenders have been embroiled in a protracted legal battle. Aiteo has claimed it has already repaid $1.2 billion and denies defaulting. However, the lenders argue that its outstanding debt has reached approximately $2.6 billion, factoring in interest, fees, and penalties.
In the face of the recent lawsuit, Peters is scheduled to hold a crucial meeting with officials from the Zimbabwean government. The meeting aims to address delays in a platinum project located in the southern African country.
Peters, renowned for his philanthropic endeavors, is seeking to resolve concerns and find a way forward for the project, marking a significant step in addressing the project’s setbacks.
Recent reports suggest that Peters is also exploring opportunities in Zimbabwe’s lithium mining sector. Peters’ interest in the country’s mining sector could pave the way for new investments and partnerships in Zimbabwe’s resource-rich industry.
