Billionaire debtor! How Mike Adenuga Willfully Ignores a Mountain of Unpaid Bills and Evades Multiple Taxes

Like most wealthy Nigerians who flaunt a semblance of wealth while in front of banks, institutions and businesses with billions of money in different currencies, Otunba Mike Adenuga is surprisingly in a class of its own.

The businessman who is the third Nigerian on the Forbes list of billionaires for the year 2022, has a mountain of debts, so high that he is known to have refused to repay them despite several attempts to get him there .

His growing debt profile makes one wonder how he ranked on Forbes, the luxury lifestyle magazine, even though the US magazine claims his net worth has jumped nearly $5 billion in the past. last year.

The credibility of this information despite its debts and defaults leaves much to be desired.

Its chronic indebtedness hit some of its creditors so hard that they had to shut down some of their operations.

For example, his company ConOil owes a combined debt of more than $140.5 million to two foreign companies and one local company.

Despite several promises of payment, PremiumTimes reports that ConOil and some of its other companies have reneged on paying the debts.

One such company is Depthwize, a local oil services company, to which ConOil owes $40 million.

ConOil management’s refusal to pay Depthwize, a small drilling contractor, has forced the company to lay off workers and shut down services on two of ConOil’s rigs until the money is paid. said people familiar with the matter.

Things are said to have gotten so bad that some of the corporate creditors have taken or are considering taking legal action to force him to pay, after exhausting all options to make him honor his promises and agreements.

Similarly, an American oil and gas company, Baker Hughes, was forced to file a lawsuit to liquidate one of Adenuga’s companies, Belbop Nigeria Limited, for the sum of $12.09 million it tried to make the company pay.

Baker Hughes argued that in 2009 it was awarded a contract by Belbop for the provision of directional drilling services, MWD/LWD and the supply of drilling fluids and drill bits, a logging cabin and a surface acquisition system.

The company told the court that after duly fulfilling its obligation and rendering all required services, Belbop refused to pay. Baker Hughes said it incurred a liability of $9.4 million in connection with the performance of the contract.

On April 12, 2016, Babs Kuewumi of the Federal High Court in Lagos placed an interim injunction on Belbop’s accounts, pending the prosecution’s decision.

The judge therefore appointed the Chief Registrar of the Federal High Court as receiver/manager of Belbop until the action on the merits was decided.

Adenuga is also giving multinational oil company Total a headache over a $28.5 million debt it has owed the French oil giant since 2009.

As Total attempts to resolve the debt issue without litigation, Mr Adenuga’s refusal to pay the debt has forced the company to halt work on the OML 136 gas field.

Total is ConOil’s technical partner in the project.

In a meeting held with Total in November 2015, it was agreed that ConOil would pay the $28.5 million due by January 31, 2016.

But those familiar with the matter said Adenuga’s company had yet to pay.

All attempts by Total to get him to release the money have failed.

Some said they were baffled by Adenuga’s refusal to pay Total the $28.5 million, which would have seen work start on the lucrative oil field.

The OML 136 asset is considered one of the largest gas fields in Nigeria, with a proven reserve of 11 trillion cubic feet (TCF) of gas.

Exploration of oil assets can boost Nigeria’s economy by creating jobs and would have brought massive returns to Total and ConOil, experts say.

When contacted, Total spokesman Charles Ogan in an email to PREMIUM TIMES said it was an “obvious internal administrative matter”.

In addition, ConOil is embroiled in a decade-long dispute with British oil company Vitol over its alleged failure to pay a $60 million debt incurred following the removal of shipments of refined petroleum products.

Vitol obtained a court order in the UK over the debt, but was unable to enforce it in Nigeria because ConOil obtained a stay of execution from a Nigerian court.

ConOil’s financial problems may have been caused by Adenuga’s slowness to capitalize on the company’s potential revenue, insiders say.

They cite that ConOil was granted an exploration license in 2005 for OPL 257 by the federal government, but the company surprisingly left the block fallow until its license expired.

He is now asking the government for a two-year extension of his expired license to allow him to explore the land.

On January 22, 2016, Taiwo Olushina, the managing director of ConOil, wrote a letter to National Petroleum Investment Management Services (NAPIMS) blaming insecurity, high cost of drilling and technical problems for his inability to explore the field. before the expiration of the License.

Adenuga businesses have also had tax problems in the recent past.

In 2009, the Federal Inland Revenue Service (FIRS) sealed the Lagos offices of ConOil and Continental Oil and Gas, another company owned by the businessman, for failure to remit $610 million in taxes. to the government.

Last month, seven years after closing its businesses, FIRS closed the Lagos offices of Globacom, the country’s second-largest mobile phone company, owned by Adenuga for allegedly failing to remit value added tax. worth N24.3 billion.

Earlier in February this year, the Osun State Internal Revenue Service (OIRS) sealed the offices of the state telecommunications company for failing to pay overdue taxes and other levies relating to base stations/masts and the laying of fiber optics.

The state said several meetings had been held with company representatives over the past three years to resolve the issue, but the company had not complied.

Asset Management Company of Nigeria (AMCON) has also listed Adenuga as one of the biggest debtors in the country for a N2.4 billion loan that its property company, Convenant Apartments Complex Limited, took from Wema Bank.

AMCON acquired the loan from the bank in 2010, after Convenant Apartments failed to repay.