The Business and Property Court of England sitting in Wales, on Monday, has ruled in favour of Nigeria in the case seeking the dismissal of an $11 billion arbitration award in favour of Process and Industrial Development Limited (P&ID).
The judgement, which was delivered by Justice Robin Knowles, read in part, “In the circumstances and for the reasons I have sought to describe and explain, Nigeria succeeds on its challenge under section 68. I have not accepted all of Nigeria’s allegations. But the Awards were obtained by fraud and the Awards were and the way in which they were procured was contrary to public policy. What has happened in this case is very serious indeed, and it is important that section 68 has been available to maintain the rule of law.”
P&ID had agreed with Nigeria in 2010 to build a gas processing plant in Calabar, Cross River State, but the company said the deal collapsed because the Nigerian government did not fulfil its end of the bargain.
Claiming Nigeria breached the terms of the contract, P&ID took a legal recourse and secured an arbitral award against the country.
On January 31, 2017, a tribunal ruled that Nigeria should pay P&ID $6.6 billion as damages, as well as pre-and post-judgment interest at seven per cent.
Following the judgment, Nigeria applied for an extension of time and relief from sanctions.
The application was granted by Ross Cranston, a judge of the Business and Property Courts of England and Wales, in September 2020, thereby returning the case to arbitration.
Nigeria had alleged that the gas deal was a scam conceived to defraud the country.
Lawyers representing the federal government told the court that P&ID officials paid bribes to secure the contract.
But P&ID denied the allegation and accused the Nigerian government of “false allegations and wild conspiracy theories”.
In a March trial at the court, Nigeria alleged that the contract was secured through dishonest means that included bribery and perjury and that the arbitration award, which then rose to $11 billion because of interests, should be quashed.
In September, it was reported that representatives of P&ID were actively seeking negotiations with the federal government to reach an out-of-court settlement.