UK Court Overturns $11 Billion Damages Bill for Collapsed Gas Deal Against Nigeria.
A landmark decision by a court in the United Kingdom has ruled in favor of Nigeria, effectively overturning an $11 billion damages bill related to the controversial Process & Industrial Developments (P&ID) gas deal. The ruling follows a lengthy legal battle between the Nigerian government and P&ID, a British Virgin Islands-based company, that has spanned several years.
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The court’s verdict, reported by Reuters, found in favor of Nigeria, accepting the country’s argument that the P&ID deal was, in fact, a collapsed gas processing contract that had been fraudulently obtained through bribery. This marks a significant victory for Nigeria in a case that has drawn international attention.
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In 2010, Process & Industrial Developments (P&ID) was awarded a 20-year contract to construct and operate a gas processing plant in Southern Nigeria. The primary objective of this project was to harness Nigeria’s abundant gas reserves for the benefit of the nation.
However, when the gas deal failed, P&ID filed a lawsuit against Nigeria in London in 2017, seeking compensation. Initially, the company was awarded $6.6 billion for alleged profit losses, but due to interest, the damages bill escalated to over $11 billion. This enormous sum represented approximately one-third of Nigeria’s foreign exchange reserves, posing a significant economic challenge to the nation.
During the legal proceedings, Nigeria’s legal team argued vehemently that their country was a victim of what they referred to as “a campaign of bribery and deception” orchestrated by P&ID. They alleged that the company had resorted to paying bribes to Nigerian officials in order to secure the contract, and had also corrupted the country’s lawyers to obtain confidential documents during the arbitration process.
P&ID, on the other hand, strongly denied these allegations, placing blame for the failure of the gas deal and the country’s arbitration defeat on what they termed “institutional incompetence.”
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In delivering the verdict, Judge Robin Knowles stated, “I have not accepted all of Nigeria’s allegations.” However, he went on to emphasize that the arbitration awards “were obtained by fraud, and the awards were, and the way in which they were procured was, contrary to public policy.
The UK court’s decision to overturn the $11 billion damages bill marks a significant turning point in this high-stakes legal battle. The ruling underscores the importance of upholding transparency and legality in international business agreements and serves as a victory for Nigeria in its efforts to combat alleged corruption in this controversial gas deal.
