Legal battle on three gas blocks rages on

THE constitution petition over interest rights involving Tanzanian businessman Moto Mabanga on three gas blocks located in Mtwara Region, Southern Tanzania, has taken a new turn following contentious arguments whether the High Court has jurisdiction to determine the matter or not.

While advocates for the local businessman maintain that the High Court is well vested with powers to adjudicate the petition, counsel for three foreign companies Ophir Energy PLC, Ophir Services PTY Limited and British Gas Tanzania, dealing with exploration of gas are of different views.

The contentious arguments follows an invitation by Judges Aloysius Mujulizi, Edson Mkasimongwa and Lugano Mwandambo, to require the parties to address them on a number of issues on dispute relating to interest rights on the three gas Blocks One, Three and Four.

Among the issues include whether the High Court should act as an appellate jurisdiction after the matter being determined by the Commissioner of Petroleum Affairs and whether the consultancy and termination agreements could be admitted as evidence without payment of stamp duty.

Advancing reasons to support their position, advocates Gabriel Mnyele and Jethro Turyamwesiga submitted that it was clear from pleadings that what was being complained of in the petition was breach of Mabanga’s basic rights occasioned during process of terminating the consultancy agreement.

They told the panel that was not at all ancillary to any operations of exploration or development and such categories of disputes may only cover service providers during exploration or development operations, which was not the case before the court.

“It is therefore submitted that it was quite proper not to rafter the dispute to the Commissioner as he was not seized with jurisdiction to entertain the dispute in this nature.

Therefore, the petitioner did not have any alternative avenue to apply for redress prior to petitioning the High Court,” they submitted. Further to that, according to the advocates, jurisdiction to entertain disputes arising from breach of basic rights under part III of the Constitution as per Article 30 940 of the Constitution of Tanzania read together with Basic Rights and Duties Enforcement Act are vested with the High Court. “Matters complained of in the petition constitute the breach of basic rights.

The commissioner for petroleum has no power to entertain the same. It cannot be said therefore that there was other adequate avenue of redress available to petitioner before approaching the High Court,” they argued.

Regarding the question of payments of stamp duty, the advocates agreed that indeed such payments were not made for the consultancy and termination agreements, but submitted that lack of stamp duty in a document cannot vitiate the existence of the petition, neither cause it to be struck out.

However, Dr Wilbard Kapinga, advocate for Ophir Energy PLC and Ophir Services PTY Limited and counsel Joseph Ndazi for the BG Tanzania, requested the court to “strike out” the petition with costs for Mabanga’s failure to exhaust alternative remedies available to him before going to court.

“We submit that because the petitioner has not exhausted alternative remedy available before the Commissioner for Petroleum Affairs with respect to the dispute, the petitioner has offended section 8 of the Basic Rights Act and for this reason his petition should be denied,” they submitted.

The advocates submitted that the dispute as pleaded in the petition was the nature that falls with the first instance adjudicatory jurisdiction of the commissioner for petroleum affairs and since there was no evidence that it was referred to him and was refused, the court jurisdiction was barred as per the law.

On the question of stamp duty payable to the consultancy and termination agreements, counsel for the foreign companies submitted that section 5 (1) of Stamp Duty Act requires payment of stamp duty on every instrument specified in the Schedule to the Act, thus making mandatory requirement.

“Therefore, the consultancy agreements and the termination agreement pleaded by the petitioner are mandatorily chargeable with stamp duty. It will be seen that upon examination of those agreements, there is no evidence that stamp duty was affixed on the face of those instruments,” they submitted.

In the petition, Mr Mabanga claims to be coerced by the three firms to surrender his interests in the three blocks One, Three and Four, to receive undervalued consideration of 7.5 million US dollars.

He alleges that he was underpaid in respect of his rights of five per cent in each of the three blocks, 7.5 million US dollars, while the true value of exactly the same interests in accordance with the industry value thereof was at least 322 million US dollars.

As a result, the businessman was deprived of his rights to own property on a fair remuneration and compensation and was forced out of the new corporate set up on racial basis.

Such acts, including that of discrimination of being called a black African, were unconstitutional as were against Articles 13 (1) (2) (3) (4) and (5) and Article 23 (1) and Article 24 (1) (2) of the Constitution of the United Republic of Tanzania.

The petitioner is, therefore, seeking for declaratory orders sanctioning the respondents for the unconstitutionality of their acts and conduct and that they benefited illegally from their unconstitutional actions against him with respect of his interests in the said gas blocks.

He is further seeking for an order to protect him as provided for in the Constitution, with respect to his right to his interests in the said three gas blocks, notwithstanding the fact that he was deceived by the respondents on the matter.