EMI refutes $120m fraud claims against co-founder Innocent Ezuma, cites valid agreements,  projects – Businessday NG

Energy and Metals Industries Limited (EMI) has issued a detailed response to media reports alleging that Innocent Ozoemena Ezuma, its Co-Founder,   defrauded a foreign investment partner of approximately $120 million in connection with mining and power development projects in Nigeria.

Describing the reports as misleading, incomplete, and lacking crucial contractual context, the Abuja-based resource development firm categorically rejected the characterization of its business relationship as a fraudulent personal financial transaction.

In a formal statement released recently, EMI’s management insisted that the matter stems from a complex, multi-year commercial partnership established under formal corporate agreements, rather than a case of personal indebtedness or fund misappropriation.

According to the company, the business relationship began with a Memorandum of Understanding (MoU) signed on March 23, 2008, in Kyiv, Ukraine. The MoU laid out a framework to acquire mineral exploration and extraction licenses and build processing facilities in Nigeria, targeting an overall investment portfolio of up to $1.5 billion.

Under the agreed terms, the foreign investor was to contribute 20 percent of the proposed investment as interest-free credit, while the remaining balance was to be sourced through independent financial institutions. This structure was later expanded by a Corporate Agreement signed on January 30, 2013, specifically targeting the development of a coal-fired power plant in Itobe, Kogi State.

EMI stated that these agreements establish that the funds were provided within an agreed corporate investment framework involving shared equity, capital commitments, and asset development.

Addressing claims in media reports that the projects were non-existent or abandoned, EMI pointed to a series of regulatory approvals, technical reviews, and physical exploration works conducted over the years:

25-Year Mining Lease: The Federal Ministry of Solid Minerals Development granted the company reconnaissance permits, exploration licenses, and a 25-year mining lease effective from September 10, 2014, through September 9, 2039, covering copper, gold, lead, and zinc.

Kogi Exploration Works: Technical evaluations included the drilling of 57 boreholes totaling 6,025 meters, 11 trenches spanning 970 meters, 78 test pits, alongside extensive geological mapping and geophysical surveys.

Zamfara Exploration Works: Site activities included geological mapping, 385 soil geochemical samples, geophysical surveys, trenching, and shallow prospect workings that yielded a preliminary inferred gold resource estimate.

Independent Audits: Exploration data and quality assurance protocols underwent technical reviews by international consultancies, including SRK Exploration Services (UK) and CSA Global (Australia).

300MW Power License: Through its project entity, Itobe-1 Coal Power Limited, the company secured a Nigerian Electricity Regulatory Commission (NERC) power generation license for a 300MW on-grid coal-fired power project, valid through September 29, 2031.

EMI noted that while a 2015 pre-project feasibility study identified additional drilling and environmental assessments as necessary steps toward a Final Investment Decision (FID), the documented progress proves the projects had moved far past the conceptual stage.

Responding to allegations that funds were diverted to entities associated with  Ezuma and his family, EMI stated that commercial associations do not equate to financial misconduct. The company urged that any claims regarding specific transfers be backed by verifiable financial records and evaluated within their proper commercial context.

The company also addressed references to the acquisition of the defunct Jos Steel Rolling Company Limited by its affiliate, Zuma Steel West Africa Limited (ZSWL). EMI clarified that the asset purchase was completed in 2005 through a court-supervised liquidation guided by the Bureau of Public Enterprises (BPE), years before the 2008 foreign investment agreement was signed.

EMI emphasized that operational constraints in Nigeria’s industrial sector, particularly chronic power supply deficits, have historically affected energy-intensive industries nationwide, and these realities must be factored into any objective assessment of project timelines.

EMI emphasized that the dispute is already before the Nigerian judicial system. Following an arbitral award issued on January 17, 2020 (LCIA Arbitration No. 194203), the Zuma companies initiated court proceedings in March 2020 before the High Court of the Federal Capital Territory (FCT), Abuja (Suit No. FCT/HC/CV/001/2020), seeking to set aside five arbitral awards on grounds of illegality, misconduct, and lack of jurisdiction.

Separately, enforcement applications filed in Suit Nos. FCT/HC/CV/1811 to 1815/2022 remain challenged by EMI and its affiliates.

While expressing respect for the statutory mandate of the Economic and Financial Crimes Commission (EFCC) to investigate financial allegations, EMI maintained that an ongoing investigation must not be conflated with an established finding of guilt.

“Dr. Ezuma has not been convicted of any offense, and the constitutional presumption of innocence under Section 36(5) of the 1999 Constitution remains sacrosanct,” the company stated.

Calling for responsible and balanced reporting, EMI urged media organizations and the public to distinguish between ongoing commercial disputes and criminal wrongdoing, respect court processes, and refrain from premature conclusions while legal proceedings run their course.

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