Court

A British court has granted the Nigerian government more time to appeal against the 9.6 billion U.S. dollars arbitral award delivered in favor of the engineering firm Process and Industrial Developments(P&ID).

An appeal court in London has granted Nigeria’s application for an extension of time and relief from sanctions due to the exceptional circumstances where the government has uncovered evidence of massive fraud in procuring the award, said Nigeria’s Minister of Justice Abubakar Malami in a statement reaching Xinhua on Friday.

The minister said the court heard evidence from the government and the P&ID to the gas supply and processing agreement. This agreement was entered into by the parties 10 years ago and which was never performed.

In 2010, P&ID entered a 20-year gas contract with Nigerian government. Under the terms of the contract, the company was supposed to build and operate a plant to refine natural gas in the oil-rich country.

However, the contract was never executed. In 2012, P&ID dragged Nigeria government to court, alleging breach of contract. In August 2019, P&ID won its case at a commercial court in London against Nigeria. Initially awarded for 6.6 billion dollars, the contract sum would rise to 9.6 billion dollars due to accrued interest since 2013.

Nigerian government subsequently appeal the ruling at the Court of Appeal in London.

Malami said Nigerian President Muhammadu Buhari-led administration, having inherited the dispute from the previous administration, only recently uncovered evidence that the agreement was a sham commercial deal.

This was designed to fail from the start, and that its subsequent arbitral award was based on fraud and corruption, Malami said, adding the government relied on several ongoing investigations across multiple jurisdictions to build its case.

The minister said the government would proceed to a full trial of the issues in the coming months, where the government’s substantive application to finally set aside the award would be heard.

Local observers said the case could now either return to arbitration based on the new evidence, or both parties will settle out of court.

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