In the oil and gas industry, Kenneth Yellowe’s name evokes a mixture of admiration, envy and respect. As the Chairman of Global Energy Incorporated, a thriving energy firm in the United States, he has also emerged as one of the select most dynamic businessmen currently operating on the African continent. Before relocating to Houston, United States in the early 1980s for further studies, Yellowe has founded several companies over the years and served as a partner in a hydrocarbon trading company in Nigeria. He ventured into a highly capital-intensive venture, set up a local subsidiary of his firm in Nigeria and leased a multi-million dollar floating, production, storage and offloading vessel (FPSO) known as the Berge Okoloba Toru from a foreign firm, Bergesen.
Spotlight gathered that when Yellowe was setting up the multimillion-naira facility in the country, his sole aim was to create jobs and improve Nigeria’s oil and gas sector with such a tremendous capacity to advance the regional and national economic growth of the nation. To show his seriousness and determination for the business, he secured over $400 million facility from international financial institutions and individual investors. His Global Gas and Oil Refining Limited (GGRL), an independent indigenous gas processing operator and liquefied petroleum gas (LPG) producer, operating in the Niger Delta Region of Nigeria, was to become the first indigenous private company to successfully embark on a multimillion-dollar gas processing and refining facility in the country, with operations and assets situated in the Niger Delta creeks of Cawthorne Channel, Rivers State.
When the FPSO commenced production of liquefied petroleum gas (LPG) in commercial quantity from the Cawthorne channel in the Bonny River, Yellowe became the toast of the oil and gas industry, as his local subsidiary Global Gas and Refining Limited (GGRL), was hailed as the best thing to happen to the domestic gas industry.
However in 1998, Shell Petroleum Development Company (SPDC) also noticed Yellowe’s success story. The global energy giant then wooed and signed a contract with his GGRL to extract liquids and heavy deposits from the associated gas and re-inject the lean gas through SPDC for onward delivery to Nigeria LNG Limited, in Bonny. The rest of the gas was fractionated into propane and butane for export to other countries. The multimillion-dollar contract became a huge money-spinner for both firms. However, few years into the deal, things fell apart when SPDC allegedly reneged on their agreement later and thereby left everything in jeopardy, thus dealing deadly blows to the gas supply agreement executed in March 1998 but renegotiated and resigned in March 2002. Consequently, a large workforce comprising several hundreds of teeming Nigerian youths were laid off; experts of different nationalities, as well as several dozens of local contractors and the thriving host communities, were made redundant. Since then, things have gone awry with Global Gas as the FPSO that was leased at a huge cost ended up being sold by BW Offshore International at a loss of over $2 million after a kidnap attempt on crew members.
All this eventually became a thorn in the flesh of Yellowe and a serious headache that seem would not go away. But like the biblical saying; “Weeping may endure for a night, but joy cometh in the morning”, it was learnt that Yellowe, who serves on other numerous boards, is currently heaving a sigh of relief as he’s already singing a victory song. Recently, a Lagos High Court set aside the arbitral tribunal award, which dismissed his Global Gas and Refining Limited’s claim for a breach of contract for the supply of gas by the Shell Petroleum Development Company of Nigeria. The presiding judge, Justice Taofiquat Oyekan-Abdullahi delivered the ruling in Suit No: LD/1910GCM/2017. In her ruling, the judge underscored the fundamental importance of full disclosure in international commercial arbitration. She, thus, upheld the argument of Global Gas that the failure and neglect of the President of the Arbitral Tribunal, Prof. Oba Nsugbe, QC (SAN) to disclose his earlier involvement in a matter in which the SPDC was involved amounted to gross misconduct for which the Award delivered by the majority of the Arbitral Tribunal ought to and must be set aside.