UK Court overturns $11 billion damages in controversial P&ID gas deal against Nigeria

A United Kingdom court has delivered a ruling in favor of Nigeria, overturning the $11 billion damages bill associated with the contentious Process & Industrial Developments (P&ID) deal.

As reported by Reuters, the court sided with Nigeria’s argument that the deal pertained to a collapsed gas processing contract, allegedly obtained through fraudulent means, including bribery.

In 2010, P&ID was awarded a 20-year contract to construct and operate a gas processing plant in Southern Nigeria with the aim of tapping into the country’s abundant gas reserves.

When the contract failed to materialize, the British Virgin Islands-based P&ID took Nigeria to court in London in 2017 and was granted $6.6 billion for lost profits.

Accruing interest, this damages bill swelled to over $11 billion, constituting approximately one-third of Nigeria’s foreign exchange reserves, according to reports.

Nigeria’s legal counsel argued vehemently that the country was a victim of “a campaign of bribery and deception” by P&ID. They alleged that the company resorted to paying bribes to Nigerian officials to secure the contract and corrupted the nation’s legal representatives to obtain confidential documents during arbitration.

P&ID, on the other hand, refuted the allegations of bribery and corruption, attributing the failure of the gas deal and Nigeria’s arbitration loss to institutional incompetence.

In the ruling delivered on Monday, Judge Robin Knowles stated, “I have not accepted all of Nigeria’s allegations,” and 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.”

Credit: Reuters