The Business and Property Court in London has put a stop to the enforcement of the $11 billion arbitration award in favor of Process & Industrial Developments (P&ID) against Nigeria. This ruling came in a case marked CL-2019-000752. The judgment, delivered by Justice Robert Knowles, determined that the process by which P&ID secured a contract in 2010 to construct a gas processing plant in Calabar, Cross River State, was fraudulent.
Justice Knowles stated, “The Awards were obtained by fraud, and the way in which they were procured was contrary to public policy. What happened in this case is very serious indeed, and it is important that section 68 has been available to maintain the rule of law.”
The dispute between Nigeria and P&ID dates back several years. P&ID accused the Nigerian government of breaching a contract by failing to provide gas. In 2017, Nigeria was hit with a $6.6 billion judgment debt when an arbitration tribunal ordered the country to pay P&ID, with interest calculated from March 2013.
P&ID contended that Nigeria violated the terms of the agreement by not supplying gas for the power plant it was supposed to build. Under the administration of former President Goodluck Jonathan, an out-of-tribunal agreement was reached for a payment of $850 million. However, President Buhari’s administration disputed the negotiated sum, set aside the settlement agreement, and challenged the enforcement of the award in the English Commercial Court. Subsequently, the London court added $2.4 billion in interest, increasing the total to $9 billion.
While the judge granted Nigeria’s request for a stay on any asset seizures during the pending legal challenge, Nigeria was instructed to pay $200 million to the court within 60 days to ensure the stay. Additionally, Nigeria must cover some court costs for P&ID within 14 days.
This development follows revelations in 2018 that Nigeria had begun investigating P&ID, uncovering evidence of two bank transfers totaling $20,000 made by Dublin-based Industrial Consultants (International) Ltd., a part of the P&ID group, to Grace Taiga, a Nigerian government lawyer responsible for awarding the gas plant contract.