A Nigerian Oil Nightmare

The Canadian newspaper Globe and Mail recently published a story on one of Robert Amsterdam’s clients, James Bay Resources Ltd. Read an excerpt below:

Nigerian elections often revolve around huge sums of money, which greases the wheels of the election machinery for the leading parties, and some insiders believe that the Canadian asset was seen as an easy way for the ruling party to raise money quickly.

Mr. Shefsky and his Nigerian partners have gone to court to block the takeover of their asset. On Friday, they obtained an interim injunction in a court in Lagos. Another hearing is scheduled for later this month on whether the injunction should remain in place until a full trial is held.

“We made a legitimate investment,” Mr. Shefsky said. “Shell and the others felt we were the best. We outbid the other bidders. There was a wrongful preemption.”

Mr. Shefsky is “courageous” for fighting the case in the courts, Mr. Amsterdam said. “There are so few Canadians willing to take that entrepreneurial risk,” he said. “I think it’s incredible that a Canadian investor is staying to fight, instead of folding his tent.”

It’s not clear what will happen with the $453-million. If the Canadian company and its Nigerian partners lose their case in court, they would probably be able to recover most or all of the money from the escrow account, but this could depend on the results of further potential court action.