- London Court Says Process P&ID Got Contract Fraudulent
NIGERIA on Monday won its bid to overturn an $11 billion damages as the Business and Property Court in London, the United Kingdom, stopped the enforcement of the $11 billion arbitration award in favour of Process & Industrial Developments (P&ID) against Nigeria.
The court, in a judgement delivered by Justice Robert Knowles, held that the process through which P&ID secured a 2010 contract to build a gas processing plant in Calabar, the Cross River State capital, was fraudulent.
Justice Knowles said: “In the circumstances and for the reasons I have sought to describe and explain, Nigeria succeeds in 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 happened in this case is very serious indeed, and it is important that section 68 has been available to maintain the rule of law.”
Nigeria claims that the collapsed gas processing project was procured by a campaign of bribery and fraud.
P&ID) was awarded a 20-year contract in 2010 to construct and operate a gas processing plant.
Upon the failure of the deal, the little-known British Virgin Islands-based company took Nigeria to arbitration.
The P&ID controversy dates back to January 2010 when the company signed a gas supply and processing agreement with the Ministry of Petroleum Resources on behalf of the Nigerian government.
Under the terms of the agreement, P&ID was to build and operate an Accelerated Gas Development project to be located at Adiabo in the Odukpani LGA of Cross River State. The Nigerian government was to source natural gas from oil mining leases (OMLs) 123 and 67 operated by Addax Petroleum and supply to P&ID to refine into fuel suitable for power generation in the country.
However, P&ID alleged that after signing the agreement, the Nigerian government reneged on its obligation after negotiations were opened with the Cross River State Government for the allocation of land for the project.
It added that attempts to settle out-of-court with the Nigerian government failed and thereafter instituted legal actions.
In March, the Nigerian government had asked a London High Court to deliver judgement in its favour in the controversial deal.
The government in closing arguments at a trial in March urged the court to overturn an arbitration award in favour of P&ID which has now accrued interest worth $11 billion.
The company claimed it entered into an agreement with Nigeria to build a gas processing plant but the deal collapsed because the Nigerian government did not fulfil its end of the bargain.
But Nigeria’s lawyer, Mark Howard, told the court that P&ID obtained its contract “by telling repeated lies and paying bribes to officials.”
Mr Howard alleged that the company financially induced top Nigerian government officials including those who chaired the government technical committee that reviewed the gas plant contract and several others.
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He alleged also that lawyers in the Nigerian team during the arbitration proceedings were bribed.