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Oriental Energy CEO Dr. Muhammadu Indimi. Image courtesy of Oriental Energy.

Oriental Energy said Tuesday that an independent review commissioned by Afren into unauthorized transactions and payments between the companies contains “egregious misstatements” that mischaracterize the disputed transactions.

The review, conducted by the UK office of New York-based law firm Wilkie Farr & Gallagher (WFG), focused on two transactions between Afren and Oriental that were not properly disclosed under the UK’S listing rules.

Investigators found that in 2012 Afren paid Oriental $100 million for a transaction that was falsely presented as a prepayment agreement.

The report concluded the payment was a loan that was improperly disclosed, a charge Oriental said it “categorically denies.”

The investigation also uncovered improper payments connected to a $300 million loan Afren gave to Nigeria-based Oriental in 2013.

Oriental said the money was payment for $180 million in net profits owed to it by Afren and $120 million to settle a longstanding dispute over ownership of tax allowances tied to capital expenditures for the jointly owned Ebok project.

Half of the $180 million was prepayment for approximately four months of Oriental’s profit oil, the company said.

WFG’s report claimed that the $180 million payment was an improperly disclosed loan that would be repaid out of oil revenues from Ebok.

“Afren’s press release, including their summary of WFG’s findings, was little more than a collection of suppositions, unsupported innuendos and a series of false and defamatory statements,” Oriental’s executive chairman Dr. Muhammadu Indimi said.

The majority of the loans have been paid off and Afren suffered no material loss from the transactions.

The investigation also found that Afren’s former CEO Osman Shahenshah and former COO Shahid Ullah had Oriental pay $45 million to British Virgin Islands-based Ntiti Limited to facilitate the unauthorized transactions.

Oriental said the payments were part an optimization agreement between the two companies and it “had every reason to believe” the arrangement had been disclosed to Afren’s board.

“It was clear to everyone privy to the optimization agreement that its intent and anticipated effect in rewarding and retaining key employees of the project was in fact the sole purpose of that agreement,” Oriental said.

While Oriental slammed the report’s conclusions, the company said it hopes its partnership with UK-based Afren “can return to its former cordial relations and exemplary performance in Nigeria’s upstream oil industry.”