Nigeria’s government was granted more time by a London judge to challenge an arbitration award worth around $10bn (€8.4bn), more than a quarter of the country’s foreign reserves.
Judge Ross Cranston said in a yesterday’s judgment granting extra time that Nigeria had established a “strong prima facie case of fraud”.
The ruling allows the West African nation to continue to seek to overturn the penalty on the grounds that Process & Industrial Developments Ltd obtained a gas-supply contract a decade ago and the favourable arbitration decision through fraud. Last year, a British judge upheld the award won in 2017, a ruling Nigeria is also appealing.
The ruling relates to a 2010 gas plant project the Nigerian government signed with Process and Industrial Developments (P&ID), a company backed by Irishmen Brendan Cahill and Michael ‘Mick’ Quinn, a one-time showband manager who died in 2015.
Nigeria argued in July that it should be allowed to contest the arbitration panel’s conclusions outside the usual 28-day time limit because evidence of corruption perpetrated by P&ID had only recently been discovered.
The potentially costly crisis for Nigeria stems from a deal struck in 2010 where the government agreed to provide gas to a plant British Virgin Island-registered P&ID proposed to build.
The administration of President Muhammadu Buhari now argues the project was a sham designed by the company and corrupt public officials to engineer a successful arbitration claim against the country.
Cranston said that, while it was not his responsibility at this stage to “decide whether a fraud took place”, Nigeria should be able to proceed to a full trial to test its accusations against P&ID.
“We are firmly committed to overturning the award, no matter how long it takes,” Attorney General Abubakar Malami said in an emailed statement. “This is a major victory in our ongoing fight,” he said. A spokesman for P&ID didn’t immediately respond to a request for comment. The company has previously denied all allegations of wrongdoing, claiming Nigeria has concocted the claims to avoid its legal obligation to compensate P&ID.
P&ID is also attempting to enforce the arbitration award in the US, as it has done in the UK. The Nigerian government has asked the US court to dismiss the company’s petition.
In 1956, the first commercial quantities of oil were found in West Africa, in the Niger Delta basin of Nigeria. It did not take long before the region became known for holding some of the largest reserves of oil and gas in the world.