The Nigerian National Petroleum Company (NNPC) Limited has won a major legal battle as the Court of Appeal in Abuja overturned a lower court ruling that awarded N5 billion in damages to its former non-executive chairman, Senator Ifeanyi Ararume.

Ararume had approached the court seeking redress after he was removed as the board chairman of the NNPC in 2021.

He won at the Federal High Court in 2023, and NNPC was ordered to pay N5 billion in damages and annulled Ararume's removal.

NNPC wins court case against Ararume

NNPC decided to appeal the judgment, and the appellate court ruled in its favour against the Federal High Court’s April 2023 judgment.

In a statement released, it was reported that the Court of Appeal ruled that the earlier judgment was delivered in error, agreeing with NNPC’s position that Ararume’s claim was statute-barred.

The statement reads:

"On August 8, 2025, the Court of Appeal, Abuja Division, upheld NNPC Ltd.’s appeal against the Federal High Court’s April 2023 judgement that annulled Senator Ifeanyi Araraume’s removal as non-executive Chairman of the NNPC Board and awarded him ₦5 billion in damages.

"The Court of Appeal’s judgement spares NNPC Ltd a massive financial payout and removes a legal risk that could have invalidated all decisions of the Board since 2021.

"The Appeal Court agreed to NNPC Ltd.’s position that the Federal High Court’s earlier decision was delivered in error, noting amongst others, that the claim was statute-barred."

NNPC celebrated the decision, describing it as a landmark victory that spared the national oil firm a huge financial payout, Leadership reports.

It added that the judgment has strengthened its corporate governance framework and sets an important precedent in Nigerian company law.

NNPC noted:

"This decision of the Court of Appeal secures governance stability for NNPC Ltd., sets a corporate governance precedent in Nigerian law, and upholds the validity of Board resolutions critical to the oil and gas industry’s investment and policy direction."