FG seeks stay of execution of $9.6bn judgment debt against Nigeria – Lifestyle News

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President Muhammadu Buhari has directed the Economic and Financial Crimes Commission, the National Intelligence Agency and the Inspector-General of Police, Mohammed Adamu, to conduct a thorough investigation into the activities of the Process and Industrial Developments Limited which was recently asked by a United Kingdom court to seize $9.6bn in Nigerian assets.

The Minister of Information and Culture, Lai Mohammed, who disclosed this at a joint press conference in Abuja on Tuesday, also said the Federal Government was challenging the UK court’s $9.6bn judgment in a United States of America’s court in order to protect the country’s interest and its assets.

Mohammed was joined at the press conference by the Attorney-General of the Federation, Abubakar Malami (SAN); Minister of Finance, Budget and National Planning, Zaynab Ahmed; and the Governor of Central Bank of Nigeria, Godwin Emefiele.

The minister said the President’s decision to probe the firm and its activities was based on the fact that the Federal Government suspected foul . in the contract which was negotiated and signed under the past administration in 2010.

He said, “We want to place on record that the Federal Government views with serious concerns the underhanded manner in which the contract was negotiated and signed.

“Indications are that the whole process was carried out by some vested interests in the past administration, which apparently colluded with their local and international conspirators, to inflict grave economic injury on Nigeria and its people.

Buhari orders EFCC, NIA to probe  2010 controversial contract

“In view of the above, and in an attempt to unravel the circumstances surrounding the entire transaction, the Attorney-General of the Federation, with the approval of Mr President, has requested the Economic and Financial Crimes Commission, the National Intelligence Agency and the Inspector-General of Police to conduct a thorough investigation into the company, the circumstances surrounding the agreement and the subsequent event, which includes commencing a full-scale criminal investigation.”

Mohammed, however, said despite the court judgment, Nigeria was not about to lose any of its assets.

He added, “Despite the recent recognition of the award by a UK court, and contrary to some reports, Nigeria is not about to lose any of its assets to P&ID. There is no imminent threat to Nigeria’s assets!

“In the first instance, the enforcement of the award cannot even commence now because the judge in the UK court ordered that the P&ID cannot enforce the judgment against Nigeria until after the court resumes from its current vacation.

“What this means is that enforcement action cannot begin until further hearing on the matter, which will take place on a date to be determined by the court upon its resumption.

“The Federal Government therefore wishes to use this opportunity to assure Nigerians that there is no immediate threat to Nigeria’s assets as has been wrongly interpreted by a section of the media.

“Nigerians should be assured that the Federal Government is taking all necessary steps to appeal the decision of the UK court, to seek for a stay of execution of the decision, to defend its rights and to protect the assets of the people of the Federal Republic of Nigeria.

“Nigerians should be assured that the Federal Government will strongly avail itself of all defences customarily afforded to sovereign states under the United Kingdom Sovereign Immunity Act to stave off any enforcement of the award.”

Giving a background to the judgment, Mohammed said it was the fallout of the contract purportedly entered into in 2010 between the Ministry of Petroleum Re.s and the P&ID.

He noted that in the 20-year Gas Supply Processing Agreement purportedly entered into with the P&ID in 2010, the company never performed as agreed, therefore necessitating the case going to arbitration.

The minister said P&ID’s claim in the arbitration proceedings was mainly for the loss of profit for the 20-year term of the GSPA.

He recalled that in an interim award, the Arbitration Tribunal ruled that Nigeria had breached the contract, adding that though Nigeria successfully applied to have that award set aside by the Federal High Court in Lagos, the tribunal ignored the decision.

He added that on January 31, 2017, the tribunal rendered its final award against the Ministry of Petroleum Re.s in the sum of $6.597bn together with a pre-award interest at the rate of seven per cent per annum, effective from March 20, 2013 and post-award interest at the same rate from the date of the award.

This interest, he explained, increased the size of the award to $9.6bn.

He added, “After the arbitration award in 2017, Nigeria made several attempts to negotiate the award and resolve the whole issue amicably with the P&ID but to no avail, which eventually led to the enforcement proceedings instituted, simultaneously, by the company in the UK and the US.

“The Federal Government then engaged the services of the US law firm of Curtis, Mallet-Prevost, Colt & Mosle LLP, which took steps to defend the proceedings in the US District Court of Columbia to dismiss P&ID’s application for the enforcement of the award on the grounds that Nigeria, as a sovereign state, has an absolute right to obtain an authoritative determination of its sovereign immunity.

“While Nigeria has recorded some successes in that case in the US, the proceedings are currently ongoing in the US and the Federal Government will ensure that its interest and that of the people of Nigeria are vigorously defended.

“It is worth mentioning that in challenging the award, the Federal Government relied upon an expert report analysing the damages given to the P&ID. The expert concluded that the damages were clearly unreasonable and manifestly excessive and exorbitant; went far beyond any legitimate protection of the commercial interest of the P&ID; were completely wrong and obviously unjustifiable; and that the damages over compensated P&ID on a frankly gargantuan scale and imposed a punitive award on Nigeria.

“It was on this ground and others that the Federal Government took all available steps to resist enforcement before the courts of the United Kingdom. Unfortunately, the UK Court has recognised the award and given the company the authorisation to seize Nigeria’s assets.”

Contract designed to fail ab initio, says AGF

The AGF, in his contribution, said the contract was originally designed to fail fundamentally.

He attributed his position to the fact that there were inherent elements of hitches that were designed into it from conception.

This, he said, was the reason why Buhari ordered a probe into the contract and the firm.

Malami said, “The President has indeed directed that full scale investigation should be carried out relating to the circumstances that gave rise to the contract in its own right, and the eventual award as well.

“The criminal investigation relating thereto, has indeed become necessary in view of the certain antecedent relating to the contract in its own right and the eventual award.

“Insinuations abound that the contract was originally designed to fail fundamentally against the background of the fact that there were inherent element of hitches that were designed into it right from conception.

“When I talk of inherent element of hitches, I want to draw attention first to the fact that by composition of the parties to the agreement there were two parties – the  P&ID which is the company and  – the  Ministry of Petroleum Re.s.

“As you rightly know very well, the Ministry of Petroleum Re.s is not a producer of gas. Gas products are produced by the International Oil Companies, and the Nigerian National Petroleum Corporation.

“So, when you conceived, signed and executed a contract for the supply of gas products without involving IOCs, NPDC, and NNPC as parties to that agreement, you know very well that there are a lot of questions to answer arising from the execution of that agreement.

“So, these among others,  gave rise to the insinuations or perhaps certain criminal and fraudulent conspiracies right from conception of the agreement. The fact remains that you cannot sign an agreement to provide a product that you do not have.

“The Federal Ministry of Petroleum Re.s does not have oil wells, marginal fields or gas products so how can the ministry sign an agreement without bringing on board those that are the custodians or the producers of the gas products with the purpose of supply of gas products?”

The minister explained that it was because of this that the present administration decided on a comprehensive criminal investigation for the purpose of identifying the undertones, whether they were indeed criminal or not.

“Within the context of this appreciation that the contract was originally designed not to succeed, that the contract was entered into with the parties that are originally not entitled to execute or sign the agreement that the Nigerian state was subjected to unnecessary economic sabotage right from the conception of the agreement down to the execution level.

“I think it is not out of place to embark on a whole scale criminal investigation with the purpose of identifying whether there exists element of local and international conspiracy for the purpose of subjecting the Nigerian state to serious economic loss that we are apparently subjected to arising from the award that has resulted from the purported breach of the agreement,” he said.

Judgment, an assault on every Nigerian – Finance minister

In her own contribution, the Minister of Finance, Budget and National Planning, Ahmed, described the court judgment as an assault on all Nigerians.

She said the amount awarded was enough to cover personnel cost in the nation’s annual budget.

She said it was important for all Nigerians to rise up to the task of ensuring that the nation and its citizens were not unfairly treated in the matter.

The minister said, “This matter that has brought us here today is a very very weighty one, an award of $9.6bn is equivalent to N3.5tn. N3.5tn in our annual budget will be covering for us the personnel cost which is about N3.2tn and some.

“So this award that is unreasonable, that is excessive and exorbitant, is also unfair and it is an assault on every Nigerian. It is beyond trying to compensate for a commercial interest. It is an assault on each and every Nigerian.

“For us in the Ministry of Finance, Budget and National Planning, we take comfort from the efforts that have so far been put in place by the Attorney-General and Minister of Justice to ensure that this judgment is set aside because the consequences will be unpleasant for each and every Nigerian.

“ I hope our brothers and sisters in the press will help fight the cause of our country. We will be doing that not just for this administration but for our children and their children. So, it is time for us to all to be up in arms to make sure that we are not unfairly treated as a people.”

No record of P&ID’s investment in Nigeria – CBN Governor

Also, the CBN governor described the contract leading to the judgment as a “fraudulent contract” between the Ministry of Petroleum Re.s and the P&ID.

Emefiele noted that contrary to its claims in the media, the foreign firm did not invest any money in the contract in Nigeria.

He said, “We have heard and also read in the  media that the P&ID or the contractor in this case had mentioned that it had invested close to about $40m in the project.

“On our part as the Central Bank of Nigeria, we note that the P&ID is a foreign company.  As a foreign company, if you are investing either in a contract or a project in Nigeria, there are various options you will adopt in bringing in your investment.

“If you are bringing in capital, in which case you are bringing in money, you will fill Form A and you will also collect a certificate of capital importation.

“If you are bringing in machine or assets to execute your contract,  then in this case you will fill Form M and also collect a certificate of capital importation to prove that you actually brought in money.

“We have gone through our records, we do not have any information in our records to show that this company brought in one cent into this country and we have accordingly written to the EFCC and the Intelligence Department of the Nigeria Police that are currently investigating this matter.”

Emefiele also said it was time for all Nigerians to rise against people alleging to be doing contract in Nigeria without investing a penny, all with an intention to defraud the country.

He added, “The money that they want to take is our own commonwealth that belongs to all of us. It is very sad that you will find some Nigerian collaborators with some foreign interests under a bogus intention trying to defraud this country.

“If they have proofs of their investment, we are calling on them to please come forward and provide us proofs of how they invested money in this project.

“You have heard the AGF talking about the fact that it was a contract that was meant to fail from the beginning and I think, we read even some Nigerian  media organisations castigating and saying Nigeria should pay.

“This is time for us to be patriotic and rise. If  you find a fault in what a governor, a minister or anybody has done, stand up and say it but not for you to collaborate and begin to join forces with people who want to defraud the country.

“I am saying from our part as the Central Bank, we do not have any information in our records, no evidence to show that a foreign company who came into this country deserved to be awarded $9.6 bn without investing a cent in Nigeria.” – Punch.

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