- Obtains order staying enforcement of P&ID arbitral award
- Gets 60 days to pay $200m deposit to court
The battle between Nigeria and Process and Industrial Developments (P&ID) over the bid to stop the company from attaching the country’s assets to recoup the $9.6 billion arbitral claim it secured last month, is set to shift to the United Kingdom Appeal Court.
The Attorney-General of the Federation and Minister of Justice, Mr. Abubakar Malami (SAN), Thursday signified the intention of the federal government to head to the UK Appeal Court shortly after the UK Commercial Court ordered a stay of execution of the $9.6 billion claim, arising from a failed gas deal between the two parties which led to arbitration.
Mr. Justice Butcher had last month affirmed the arbitral claim but fixed yesterday for hearing of an application by P&ID seeking the leave of the court to attach some assets of Nigeria for seizure to recoup the $9.6 billion arbitral claim.
It was, however, learnt that the claim would have hit a double-digit mark as interest on the original $6.5 billion the arbitration panel granted P&ID, which ballooned to $9.6 billion in August when the UK court affirmed the arbitral award, is being calculated at the rate of $1.2 million daily, minus weekends.
In its ruling yesterday, the court, which, however, upheld the claim and refused Nigeria’s plea to set it aside, said the suspension of its decision to grant P&ID’s request to seize Nigerian assets would last till the determination of the appeal by the federal government.
It, however, asked the government to make a security payment of $200million to the court within 60 days.
But Malami said besides seeking to quash the company’s bid to make any claim, Nigeria would also consider the possibility of challenging the legality of the $200 million security deposit within the 60-day window.
P&ID secured the damages against Nigeria following a failed Gas Supply Project Agreement (GSPA) contract between it and the Federal Ministry of Petroleum Resources.
Malami, in a brief from London sent to reporters in Abuja, said: “Leave to appeal has been granted. Stay of execution is also granted subject to payment of $200m security payment to court pending the determination of the appeal the leave for which has been granted by the commercial court.
“The steps we will consider are to study the ruling and act in a way beneficial to the interest of the nation.
“We will study the court rulings, exercise the right of appeal and consider the legal options available at our disposal as it relates to the payment of $200m in view of the 60 days window stipulated by the court.”
Malami, who admitted that he was pleased with the judgment, said: “I see this as a positive resolution that constitutes an important step in the government‘s efforts to defend itself in a fair and just process.
“We look forward to challenging the UK Commercial Court’s recognition of the tribunal’s decision in the UK Court of Appeals, uncovering P&lD’s outrageous approach for what it is: a sham based on fraudulent and criminal activity developed to profit from a developing country.”
Reuters reported that Nigeria’s appeal of the decision, called a “set-aside”, would need to prove there was an error in the ruling.
During yesterday’s proceedings, lawyers representing Nigeria said the judgment was flawed primarily due to its acceptance that England was the proper seat of the arbitration.
Harry Mantovu (QC) argued on behalf of Nigeria that the courts, not the arbitration tribunal, should determine this, and that the August ruling ignored Nigeria’s successful application to have the award set aside by the Federal High Court in Lagos.
The judge’s order said if Nigeria does not put the $200 million into a court account within 60 days – the minimum amount of time that Mantovu said it would take Nigeria to raise the funds from capital markets or internal sources – the stay on seizures would be lifted.
The original decision on August 16 converted an arbitration award held by P&ID to a legal judgment, which would allow the British Virgin Islands-based firm to try to seize Nigeria’s international assets.
A Nigerian delegation, whose membership included Malami, the Inspector-General of Police, Mohammed Adamu and the Governor of Central Bank of Nigeria, (CBN), Mr. Godwin Emefiele, had on Saturday arrived in the United Kingdom to prepare for yesterday’s proceedings in court.
Besides the legal battle, Nigeria has also launched a bid to bring to justice all those connected with the Gas Supply and Processing Agreement (GSPA), under which Nigeria is to supply wet gas to a plant to be built in Cross River State by P&ID for processing to generate electricity, between the two parties.
President Muhammed Buhari had in his speech at the 74th session of the United Nations General Assembly on Tuesday in New York, described the $9.6 billion arbitral claim as fraudulent.
Already, Nigeria is making moves for the extradition of the co-founder of the Irish firm, Mr. Brendan Cahill and son of the deceased founder, Mr. Adam Quinn, over their roles in the $9.6 billion arbitral award.
Nigeria is seeking the help of Irish law enforcement and the U.K.’s National Crime Agency, for the extradition of Cahill and Quinn to face trial in the country.
Besides, Nigeria is also seeking a probe of Allied Irish Banks, with a claim that it has evidence of two bank transfers by P&ID, amounting to $20,000, to a former Director, Legal Services of the Ministry of Petroleum Resources, Mrs. Grace Taiga.
Taiga is currently on trial for allegedly conniving with the company in a bid to defraud the country.
P&ID Welcomes Court Ruling
Meanwhile, the P&ID has said it welcomed the decision of the court ordering Nigeria to pay $200 million to proceed on its appeal.
It also faulted what it described as the Nigeria’s recent media onslaught against it, describe the fraud allegation against it as a red herring.
The company said Nigeria knew that there was no fraud and the allegations were merely political theatre designed to deflect attention from government’s own shortcomings.
“The court has ruled that the Nigerian Government must put up $200 million to maintain a stay of execution whilst it pursues an appeal against enforcement of the now $9.6 billion award in favour of P&ID.
“The Nigerian Government will now have to put its money where its mouth is if it wants to avoid immediate seizure of assets.
“The Nigerian Government’s recent media exercise to allege fraud against P&ID turned out to be a red herring. Indeed, the Nigerian Government did not present any evidence to support Malami’s “findings” from his sham investigation. The Nigerian Government knows there was no fraud and the allegations are merely political theater designed to deflect attention from its own shortcomings,” P&ID said in a statement.
