A London High Court judge Monday granted Nigeria’s request to overturn an award that would have required Nigeria to pay $11 billion over a failed gas project. The judge found that the contract was obtained through fraud....For More CONTINUE THE FULL READING▶▶
A key point that helped Nigeria in the case was an investigation conducted by its anti-graft agency, the Economic and Financial Crimes Commission (EFCC).
In 2010, Process & Industrial Development Ltd (P&ID) won a contract from the Ministry of Petroleum Resources to build a gas-processing plant in Calabar.
Nigeria was to supply the gas for free over 20 years and the two parties would split the processed resources. But Nigeria never provided the promised gas, and the plant was never built.
P&ID sued the Nigerian government for breach of the contract at an arbitration tribunal in England. In 2017, P&ID secured the compensation award, which originally was $6.6 billion but is now estimated to be $11 billion with accrued interest. The company’s main claim in the arbitration was for loss of profit for the 20 years the agreement covers.
But as that bitter faceoff was going on in London, the EFCC in 2018 at the request of then Vice President Yemi Osinbajo and President Muhammadu Buhari opened an interim investigation into the P&ID contract.
Ibrahim Magu, who was acting head of the EFCC at the time, led the crucial investigation. He was later humiliated out of office in controversial circumstances. The real reason for his removal remains unclear. The report of an investigation into his tenure, which was masterminded by vested interests, has yet to be made public year’s after.
The anti-graft agency later indicted Grace Taiga, a former petroleum ministry lawyer for taking bribes related to the P&ID gas contract. It also accused Ms Taiga of corrupt practices and intent to defraud.
EFCC also established that a now-deceased petroleum minister broke the law by signing the contract without proper approvals and protocol.
Following the law enforcement’s investigations, On 19 September 2019, P&ID was convicted by the Nigerian High Court of various offences relating to tax evasion, money laundering and trading without necessary licences.
This intelligence provided by EFCC is what helped Nigeria overturn the $11 billion award, a payment that would have dealt a massive blow to Nigeria’s ailing economy.
In a court ruling on Monday, Judge Robin Knowles confirmed based on the EFCC investigation that P&ID had paid bribes to Ms Taiga in connection with the gas contract signed in 2010, and had failed to disclose this when it later took Nigeria to court over the collapse of the deal.
Mr Knowles concluded that the P&ID contracts were “obtained by fraud and how they were procured was contrary to public policy.”
Mr Knowles added three things showed the case as an “irregularity”: P&ID providing evidence it knew was false in a witness statement, the company’s bribery or corrupt payment to a Nigerian civil servant and the company’s “improper retention” of Nigeria’s legal document which it received during arbitration.
President Bola Tinubu described the judgement as a blow against economic malpractice and the exploitation of Africa.
“This landmark judgement proves conclusively that nation-states will no longer be held hostage by economic conspiracies between private firms and solitarily corrupt officials who conspire to extort and indebt the very nations they swear to defend and protect,” he said in a statement.
As an endnote, Mr Knowles said that although the P&ID case was tainted with bribery and corruption, it also underlines the importance of professional standards and ethics in the work of contract drafting, including in the approach of other parties to the proposed contract.
“It is why some contributions of pro bono work by leading law firms to support some states challenged for resources (this is not to say, one way or the other, that Nigeria is one of those) is so valuable, in the interests of their, often vulnerable, people.”
“In the present case, there were other contracts too, with different counterparties. Their terms and circumstances are not identical, but the overall risk could have been a multiple of the US$11 billion now involved in the present case,” the judge said……CONTINUE.FULL.READING>>>
