A UK court has ruled that Process & Industrial Developments (P&ID) Limited must pay £20 million in damages and compensation to Nigeria within the next 28 days.
This decision comes after Nigeria’s success in overturning an $11 billion judgment debt in October, with the court citing P&ID’s reprehensible conduct in securing the gas processing contract.
The consequential ruling in London determined the next steps in the legal proceedings and whether P&ID would be granted permission to appeal the case. However, the UK court denied P&ID the opportunity to take the matter back to arbitration.
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The £20 million damages awarded to Nigeria were based on the court’s assessment of P&ID’s conduct in obtaining the gas processing contract. Nigeria had sought at least £20 million from P&ID to cover damages and legal fees.
The dispute between Nigeria and P&ID dates back to 2010 when the two parties entered into an agreement for P&ID to build and operate a gas processing facility in Calabar, Cross River State. The deal collapsed, leading to legal action initiated by P&ID, accusing Nigeria of breaching the contract.
In 2017, a tribunal ruled that Nigeria should compensate P&ID with $6.6 billion in damages, along with pre and post-judgment interest at a rate of 7 percent. In September 2020, a judge within the Business and Property Court of England, Ross Cranston, granted the application for Nigeria to pay damages to P&ID.
However, Nigeria’s legal representatives alleged that P&ID secured the contract through bribery, a claim vehemently refuted by P&ID as “unfounded allegations and conspiracy theories.”
In March, lawyers representing the Nigerian government sought to invalidate the arbitration award, arguing that the gas processing contract was obtained fraudulently. The turning point came in October 2023 when the UK court ruled in favor of Nigeria, stating that the awards were obtained by fraud and contrary to public policy.
“In the circumstances and the reasons I have sought to describe and explain, Nigeria succeeds in its challenge under section 68.
“I have not accepted all of Nigeria’s allegations. But the awards were obtained by fraud and the awards were and the way in which they were procured was contrary to public policy,” Justice Robin Knowles of the Commercial Courts of England and Wales said in the judgment.
The latest directive for P&ID to pay £20 million in damages reflects a significant development in the legal battle and is seen as another victory for Nigeria in the protracted dispute.