UK Court Squashes $11bn P&ID Suit Against Nigeria

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By Adedapo Adesanya

A court in the United Kingdom has ruled in favour of Nigeria in the P&ID case, squashing the $11 billion award against the African country, a decision that ends a five-year legal battle.

In a judgment delivered by email on Monday, Mr Robin Knowles, Justice of the Commercial Courts of England and Wales, upheld Nigeria’s prayer on the ground that the ill-fated gas processing contract was obtained by fraud.

For context, 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 ($1 million per day)

Following the judgment, Nigeria applied for an extension of time and relief from sanctions, and over the years, the penalty has mounted fresh values to $11 billion.

The application was granted by Mr 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 with the lawyers representing the federal government telling the court that P&ID officials paid bribes to secure the contract.

However, 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.

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.

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