Benjamin Omoike, Lagos
Nigeria stands to lose up to $9 billion worth of its foreign assets following an enforcement application to US and UK courts by Process and Industrial Development (P &ID), a British firm tied up in a legal dispute with the federal government.
The case arose out of the failure of a contract awarded the company in 2010 to process wet gas to power Nigeria’s generating plants.
In January 2017, a London tribunal organized under the rules of the Nigeria Arbitration and Conciliation Act, ordered Nigeria to pay P&ID $6 billion in damages, plus $2.3 million in uncollected interest. That figure has since been attracting interest at the rate of $1.2 million per day and currently stands at over $9 billion.
The next hearing of the case will come up in a London court on May 21.
Founder, Process and Industrial Development (P &ID), Mr. Brendan Cahill, said that the company looks forward to the UK and US courts granting enforcement rights that will allow P&ID to collect what is rightfully hers.
“If history is any guide – just look at how creditors seized Argentina’s naval frigate while it docked in Ghana. Efforts by Nigeria to evade this judgment will inevitably fall flat.
The ball is in Nigeria’s court, if the government is prepared to find a good-faith solution,” he said.
Cahill however, indicated that the company was open to negotiations with the federal government to settle the dispute out of court, adding that “P&ID remains open to a settlement on a reasonable basis, but we need a willing partner in government to help resolve this matter. The onus is on the Nigerian government to act in good faith to find a solution.”
After the P&ID’s gas supply and processing agreement with the federal government failed, the company initiated arbitration proceedings in London in line with the original contractual agreement between the parties.
Cahill said the company decided to go to court after several attempts at salvaging the deal were botched.
He said: “P&ID’s agreement failed when the government did not uphold its commitments.
In August 2012, after several attempts over two and half years by P&ID to salvage the agreement, including offers to renegotiate the deal, the company initiated arbitration proceedings.”
Cahill is saddened by the failure of such a promising project and government’s lack of interest in trying to resolve the dispute amicably, adding that the original project would have brought power and economic growth to Nigeria by supplying free natural gas for electricity generation, as well as building a highly successful commercial venture with a share of profits going to the Nigerian government.