BEVERLY HILLS, November 29, (THEWILL) – Nigeria has given a bank guarantee of $200 million to the United Kingdom Commercial Court hearing its dispute with a British Virgin Islands-based engineering firm, Process and Industrial Development Limited (P&ID), over a botched Gas Supply and Processing Agreement (GSPA), which the federal government believed was fraudulently procured.
In what is clearly a positive step forward for Nigeria, the United Kingdom Commercial Court presided over by Justice Butcher yesterday accepted the application of Nigeria in its case against P&ID to vary the conditions of the stay of execution of the enforcement order it had earlier granted P&ID.
With the approval, Nigeria will now only need to provide a bank guarantee rather than paying the $200 million security deposit the court had earlier demanded as a precondition for the country to appeal against the $9.6 billion arbitral award.
“This variation in security, which was proposed by Nigeria as an alternative solution during a procedural hearing on 22nd November, has been accepted by the court and P&ID,” a report by Reuters quoted the Attorney General of the Federation (AGF) and Minister of Justice, Mr. Abubakar Malami, as saying in an emailed statement.
Nigeria had in September won the battle to appeal an earlier ruling given the previous month that would have given legal backing to P&ID to seize national assets if the court had agreed to turn the $9.6 billion arbitral award to a judgment.
Besides, the country had vowed to resist any attempts to make it pay any amount to P&ID.
The government has also expanded its legal team to include London-based law firm Mishcon de Reya. Shaistah Akhtar, a partner with the firm, will lead the legal team alongside Mark Howard QC of Brick Court Chambers, Malami said.
The UK court had on November 22 rejected the application of the federal government for extension of time to comply with the deposit of the $200 million security, but indicated its readiness to accept a “satisfactory bank guarantee” as proposed by the federal government towards the end of the hearing on that day.
The federal government, on another front, also launched a bid to stop a legal reprieve for a British citizen, James Nolan, standing trial over his alleged link with the Irish firm, by objecting to his application for bail variation before the Federal High Court, sitting in Abuja.
Investigations carried out on the dispute between Nigeria and P&ID over the past few weeks, have revealed incidences of serious fraud, bringing into question both the legitimacy of the GSPA and the subsequent $9.6 billion arbitral award to the company.
