Nestoil Group and Neconde Energy are preparing to file a $1.8 billion damages claim against a consortium of banks, alleging that actions taken by the lenders disrupted their oil production operations and caused significant financial losses.

The move follows a Federal High Court decision rejecting an application by the banks and their affiliates to transfer an ongoing case to another judge. The court relied on an earlier Supreme Court ruling, which found no basis for reassigning the matter.

According to Nestoil and Neconde, the actions of the banks and an appointed receiver-manager led to a sharp decline in crude oil production, reducing output from about 60,000 barrels per day to below 40,000 barrels per day. The companies also said planned drilling activities involving the Pathfinder 500 drilling rig were disrupted.

The firms claim the production losses and operational setbacks resulted in damages estimated at $1.8 billion, which they intend to recover through legal action.

The dispute has widened with Drawcok Estate Limited filing a separate N100 billion lawsuit against FBNQuest Merchant Bank, First Trustees, the receiver-manager and others. The company alleges the wrongful takeover of properties located in Victoria Island, Lagos.

The growing legal battle is expected to have significant financial, commercial and reputational implications for the parties involved as multiple cases continue before the courts.