Security:
Twist In Judgment

Their seems to be a twist in the FG, P&ID judgment that would have impacted negatively on the economy of the nation


Nigeria’s world appeared to have come to a standstill when the Commercial Court in London had ruled earlier that Nigeria will pay $9.6 billion to a Swiss gas company, Process and Industrial Development, P & ID, over breach of contract for gas installation for Africa’s largest nation. Nigeria did not take the judgment which would have depleted its foreign assets to low ebb.

In the appeal at the same court whose ruling was given on September 26, the court upheld Nigeria‘s appeal that the federal government should be permitted to present arguments against the enforcement of a US$9 billion arbitral award despite having missed a filing deadline – citing the size of the damages and the “major impact” it could have for the country’s citizens and tax payers among other factors. Apparently basking in the euphoria of the reprieve given by the British commercial court, which ordered a stay of execution of the $9.6 billion judgment debt against Nigeria and the leave granted the country to appeal the judgement, the federal government said it would file a separate suit to set aside the entire judgment. Minister of Information and Culture, Lai Mohammed, gave the indication in London after the September 26 ruling of the court on the arbitration award to P&ID.

Mohammed also said besides the stay of execution and the leave to appeal the judgement obtained by Nigeria, the federal government’s delegation to the UK succeeded in changing the narratives of the case in favour of Nigeria before the international community. On the opportunity presented by the judgement, he said: “We now have a fresh opportunity of arguing our case and even filing separate suit to argue that the entire judgment be set aside. “As we have been saying everywhere we go, we have been compiling arguments that will make our case and position to set aside the judgment debt, an easy thing” he added. He expressed optimism that the entire arbitration decisions and the whopping judgement debt of N9.6 billion against Nigeria over a botched gas contract would be set aside. Mohammed said with the reprieve granted by the court, Nigeria has the opportunity to take appropriate steps to set aside the entire judgement debt in favour of P&ID. According to him, the federal government delegation’s meeting with investors and other stakeholders, helped to change the negative narrative that the case might hamper foreign investments into Nigeria.

He said: “Many of them at the meeting are investing in Nigeria and holding key positions in the society. By the time we came out of the meeting, they had more empathy for our course and even many of them volunteered to serve our course in a very patriotic manner.” Mohammed further added: “We came here with the sole purpose of not just winning in court but also winning the minds of the international community. “We started by visiting key media outlets, key business and financial groups such as Bloomberg, Financial Times, the Economists and others.

According to the Minister, “I must say that over 24 major publications that published our stories are from our own viewpoints. What we are saying is that, until now, only the voice of P&ID was heard; only their own side of the story was heard but in the last four days our efforts in visiting the key media outfits and think tanks have paid off in changing the narratives.”

The Minister said prior to the visit, the plaintiff, armed with the court judgment, had been threatening to enforce it by way of attaching financial and associated assets of Nigeria. He said with the relief granted by the court, the harassment by the company and its handlers of compiling the nation’s assets for attachment would stop. Speaking in similar vein, Abubakar Malami, Attorney-General and Minister of Justice said: “Stay of execution granted subject to $200m security payment to the court pending the determination of the leave which the court has granted”.

The minister expressed delight over the development in the court and sees it as “a positive resolution that constitutes an important step in the government’s effort to defend itself in a fair and just process.” Apart from the Justice and Attorney General of the Federation, Abubakar Malami (SAN); and Lai Mohammed, Information Minister; other members of the Nigerian delegation were the Governor of Central Bank of Nigeria, Godwin Emefiele; the Inspector-General of Police, Mohammed Adamu and the Acting chairman of the Economic and Financial Crimes Commission, Ibrahim Magu. P&ID had taken Nigeria to arbitration in London over an alleged breach of the gas supply and processing agreement (GSPA) signed by the ministry of petroleum resources in January 2010. The company won the liability case in July 2015 and was awarded $6.6 billion.

A British commercial court had in August affirmed the ruling of the London arbitration tribunal. The tribunal had ruled that Nigeria was liable for $6.6bn in damages, which increased to about $9.6bn with accruing interest. The Nigerian government had stridently contested the company’s claim, insisting that the contract was a scam, in which P&ID did and spent nothing on the failed project, adding that it was a heist that could impoverish the over 200 million Nigerians.

Besides, a former minister of Defence, Lt. Gen. Theophilus Danjuma (rtd), has since contended that the $40 million the company claimed to have spent on the project was provided by him, claiming that the main promoter of the company, Michael Quinn, double-crossed him in the deal. P&ID signed the GSPA with the Ministry of Petroleum Resources in 2010 to build a gas plant that would process wet gas into dry gas for electricity generation. Under the terms of the agreement, Nigeria is to supply the wet gas to the plant, to be built by P&ID in Cross River State. The GSPA documents, however, contained what has been described as a “curiously careful provisions for what should happen if the deal soured.” When the deal went sour, the arbitrators awarded all the theoretical profits P&ID might have made in a perfect world in 20 years, in a very imperfect part of the world (Nigeria), according to an analyst.