The Process and Industrial Development has lost its final appeal against Nigeria in an eleven-billion-dollar arbitration case.
The company sought to overturn an October judgement by a London High Court that halted the enforcement for damages over a failed gas processing project.
The High Court had earlier ruled in October that the British Virgin Islands based company, paid bribes to a Nigerian oil ministry official in connection with the gas contract signed in 2010, and failed to disclose this when it took Nigeria to arbitration over the deal which eventually collapsed.
In his ruling, Judge Robin Knowles rejected P&ID’s argument that the case should be returned for arbitration and affirmed that the damages award should be thrown out completely.
Judge Knowles had on October 23 ruled in favour of Nigeria in the enforcement of a $11bn Process & Industrial Developments (P&ID) Limited arbitration award.
According to the judge, the award against Nigeria by the company was obtained by fraud.
The judge had found out that P&ID paid bribe to Nigerian officials who were part of drafting of the gas supply and processing agreement in 2010.
Also discovered by the Judge was that P&ID was illegally in possession of Nigeria’s privileged legal documents during the arbitration hearings.
Nigeria had urged the court to set the award aside, saying that some individuals in the case were being tried for money laundering and graft.
But after listening to the arguments by lawyers to P&ID which included that the documents found in their possession played no role in its initial victory at the arbitration, the Judge on Thursday refused to grant the permission to appeal.
P&ID cannot apply for permission from the Court of Appeal.
In January 2010, P&ID, a Virgin Islands-registered company founded by two Irish business partners, signed a Gas Supply and Processing Agreement (GSPA) with Nigeria to develop a processing plant in Calabar, the Cross River State capital but the deal failed in August 2012 and the company sought a $5.96bn compensation from Nigeria with arbitration proceedings against the country at the London Court of International Arbitration.
In January 2017, the arbitration said Nigeria breached the contract and ordered the country to pay the company $6.6bn with interest starting from May 2013. Before the verdict, the interest fixed at seven percent ($1m daily) had accumulated to over $11bn.
Subsequently, Nigeria filed an appeal against the enforcement of the award and the court granted the relief sought by the country in September 2020. The Nigerian side argued that there was enough evidence that the contract and the arbitration award were procured by fraud.
The Nigerian side thereby urged the court to set the award aside, saying that some individuals in the case were being tried for money laundering and graft.
In his October ruling, the judge not only agreed that the arbitration awards were obtained by fraud but also that the manner that they were procured were contrary to public policy.
