The Federal Government has approached the Court of Appeal in Lagos, seeking to overturn a Federal High Court judgment that restored the Dawes Island Marginal Field licence to Eurafric Energy Limited.

In its appeal, the government argued that Eurafric failed to develop the oil asset and commence commercial production despite holding the licence for nearly 17 years.

The appeal, filed by the Ministry of Petroleum Resources and the Minister of Petroleum Resources through their counsel, Adebayo Ologe, challenges the January 29, 2026 judgment delivered by Justice Abimbola Awogboro of the Federal High Court, Lagos.

The lower court had granted all 17 declaratory and injunctive reliefs sought by Eurafric Energy Limited, effectively restoring its rights over the marginal field.

However, the Federal Government contends that the decision was erroneous, insisting that Eurafric did not fulfil the primary objective for which the field was allocated.

According to the appellants, the Dawes Island Marginal Field was awarded to Eurafric in February 2003 under the Federal Government’s Marginal Field Programme, with the expectation that the company would develop the asset and begin commercial production within five years.

The government stated that despite receiving several extensions, including those granted in 2011 and 2016, the company failed to achieve the required production milestones.

The appellants further relied on a 2015 performance evaluation report, which reportedly classified Eurafric among operators that had shown little or no commitment to developing their marginal field assets.

They argued that when the final extension was granted in 2016, the company was clearly informed that it represented its last opportunity to bring the field into production and that failure to do so would lead to the withdrawal of the licence.

Although Eurafric conducted an Extended Well Test between 2016 and 2018 and extracted 62,039 barrels of crude oil, the government maintained that the exercise did not qualify as commercial production under applicable petroleum regulations.

According to the appellants, commercial production requires compliance with specific technical, operational and regulatory standards beyond crude oil extraction during a testing phase.

The Federal Government also challenged the lower court’s conclusion that the revocation of Eurafric’s licence in April 2020 was unlawful.

It argued that the trial court wrongly relied on provisions of the Petroleum Industry Act (PIA) 2021 in determining issues that arose before the legislation came into force.

The appellants maintained that the revocation was carried out under the provisions of the Petroleum Act, which empowered the Minister of Petroleum Resources to withdraw licences where operators failed to meet their obligations.

The government is therefore urging the Court of Appeal to set aside the judgment of the Federal High Court and uphold the legality of the licence revocation.