The Federal Government of Nigeria has won a lingering battle between it and Process and Industrial Developments (P&ID) as the Commercial Courts of England and Wales on Tuesday, halted the enforcement of the $11billion arbitration award in favour of P&ID.
The Nigerian government had approached the court in England to stop an arbitration award in favour of P&ID which has risen to $11.5 billion because of interests.
The suit marked CL-2019-000752, stemmed from a botched gas processing plant agreement signed by parties in 2010.
The P&ID stated that it entered an agreement with Nigerian government for construction of a gas processing plant in Calabar, Cross River state.
According to the company, the project was not actualised because the Nigerian government did not fulfil its part of the agreement, which had an arbitration clause.
The company further claimed that Nigeria failed to supply gas for the project.
Consequently, the P&ID approached an arbitration tribunal to seek awards against the Nigerian government, on the ground among others that Nigeria breached the terms of the agreement.
In a ruling, the tribunal on January 31, 2017, ordered Nigeria to pay P&ID $6.6 billion as damages and pre-and post-judgment interest at seven per cent.
Dissatisfied with the order, the Nigerian government had appealed the judgment, insisting that the botched gas processing contract was obtained by fraud.
The Federal Government of Nigeria also told the court that P&ID officials paid bribes to secure the contract.
It therefore urged the court to set aside the arbitration award, which stood at $11 billion because of interests.
However, the P&ID had denied the allegation and accused the Nigerian government of “false allegations and wild conspiracy theories”.
After a protracted legal battle, the Commercial Courts of England and Wales on Tuesday decided the matter in favour of Nigeria and halted the enforcement of the $11billion arbitration award in favour of P&ID.
Robin Knowles, Justice of the Commercial Courts of England and Wales, in the judgment delivered by email, upheld Nigeria’s submission that the botched gas processing deal was obtained by fraud and went ahead to halt the $11 billion award against Nigeria.