$9bn UK award: Lawyers advice FG to use negotiation

Following an order of a British court for the seizure of $9 billion Nigerian assets by Process and Industrial Development Limited (P&ID) over a failed gas project, lawyers have suggested a negotiated settlement of the matter.

The Solicitor General of the Federation and Permanent Secretary in the Ministry of Justice, Dayo Apata, in a statement of Friday, said the federal government lawyers had been instructed to pursue an appeal on the judgment of the English Court dated 16 August, 2019 and at the same time seek for a Stay of Execution of the said judgment.

But a former Attorney General of the Federation, Akin

Olujimi (SAN) said while the appeal and application for stay of execution of the judgment is pending, the federal government should, after a thorough review of the case of the claimant, approach it to negotiate down the award.

“Which of course, the claimant may agree with because it would have access to some funds unlike when the appeal is pursued, that may take it’s own length of time,” he said.

On the option of re-awarding the gas contract to the firm, Olujimi said it may no longer be interested in the project.

“After all, it’s not because they loved you that they offered to it for you; they were also hoping to make money from it. And now without doing the job, they have an order that they be paid that substantial amount. I don’t see them being interested in the project anymore,” he said.

Also, Ahmed Raji said the federal government should pursue vigorous negotiations as that may be appropriate at this stage and would serve some positive purposes.

For E.M.D. Umukoro, an appeal process and commitment to respect agreements should be pursued. He blamed Nigeria’s disregard for due process and rule of law as the cause of the arbitral award, saying that could discourage investors.

“Here was a process that started years ago, the company started with an arbitration process and then applied amicable resolution but due to the failure of government to resolve the lingering issues the company had no option than to seek enforcement of the arbitration award,” he said.

P&ID’s lawyer, Andrew Stafford Q.C. was quoted as saying after the judgement that: “We are pleased that the Court has rejected Nigeria’s objections both to the arbitration process and to the amount of the award and that it will grant permission to P&ID to begin enforcement of the award in the United Kingdom.

The arbitration award followed an agreement signed between Nigeria (through the Ministry of Petroleum Resources) and P&ID in 2010 for a 20 year Gas Supply and Processing Agreement (GSPA) entered in 2010 for Nigeria’s OMLs 67 and 123.

Apata said although it never began the construction, P&ID claimed it incurred about $40 million in preliminary expenses.