After almost two weeks that a British Court granted an Irish Firm, Process and Industrial Developments Ltd (P&ID) the right to seize $9 billion Nigerian assets over a failed gas project, the firm has initiated moves to identify the Nigerian assets that can be seized and it may include the country’s oil cargoes.
The company confirmed the move in a document reportedly sent to industry sources, that it had initiated moves to identify Nigeria’s assets that could be seized in the process of enforcing the decision of an arbitration tribunal which was recently converted to a court judgment.
The details: In the document, the firm hinted at the possibility of Nigeria forfeiting its oil cargoes or naval vessels in a bid to recover the $9 billion. The representative of P&ID, Mr John Ehiguese cited the Argentinean and Venezuelan experiences as similar cases of assets seizure.
“We cannot confirm specifics. However, the P&ID’s legal team is working diligently to identify and target assets that may be used for enforcement of the tribunal award. There have been many successful enforcement cases against sovereign states in the past.
“In the case against Argentina, creditors detained an Argentine naval vessel; in the case against Venezuela, there was the seizure of state-owned oil cargo. There is a wide range of potential assets.”
Similarly, there is a tendency of Nigeria losing part of its foreign reserves if the country fails to initiate a strong bargaining power.
A call to negotiate: Nigeria still has time to negotiate with the firm in terms of assets recovery, as the document stated that the onus lies on President Muhammadu Buhari to engage the country’s legal team to quickly admit and demonstrate faith in the ruling.
The document reads: “The onus is on the Nigerian government and the President Buhari’s administration to demonstrate a mature, good-faith approach to a resolution.”
Meanwhile, the company noted that the Nigerian government was playing a smart one, by trying to misinform the public through its sham media campaign and purported investigation.
Recall that in an earlier publication by Nairametrics, the Governor of Central Bank of Nigeria, Godwin Emefiele, said the judgment would be challenged to ensure the country’s foreign reserve is protected, while the Attorney General of the Federation and Minister of Justice, Abubakar Malami (SAN) also noted that Nigerians caught involved in the case would be prosecuted.
Meanwhile, the company has reacted to the moves by the Nigerian government, describing it as a sham.
“Instead of accepting responsibility or pursuing a negotiated settlement, the Buhari administration has regrettably chosen to continue its campaign of misinformation and misdirection, including wild allegations against the English judge and commencing a sham investigation.
“This approach is not constructive and will not help to resolve the situation. The P&ID will begin enforcing its legal rights, including the seizure of Nigerian assets in the UK.”
The backstory: P&ID, an Irish Firm, was awarded $6.6 billion in an arbitration decision over a failed project to build a gas processing plant in the Southern Nigerian city of Calabar. With the accumulated interest payments, the sum now tops $9 billion, which amounts to 20% of Nigeria’s foreign reserves.
According to a report, the case dated back to January 2010 under the administration of Nigeria’s former President, Dr Goodluck Jonathan. The Nigerian government had struck a deal with the Irish firm to supply gas to a processing plant built and run by P&ID in Calabar.
The contract is known as the GSPA – a Gas Supply Processing Agreement, which was entered on behalf of the Federal Government by the Ministry of Petroleum Resources.
Specifically, the deal was supposed to span 20 years. However, the Nigerian government failed to keep its side of the agreement, prompting the firm to seek legal action against Nigeria.
What next: According to a source, an attempt was made to confirm whether an appeal had been filed or if the Federal Government had instructed its lawyer to file the appeal proved abortive. The Federal Government’s lawyer, Harry Matovu (Queens Counsel), said he would not be able to speak on the matter.
Meanwhile, the country’s Minister of Information and Culture, Mr Lai Mohammed, disclosed to news correspondents that a statement would be released on Monday (today).
- When the judgement was delivered two weeks earlier, the firm immediately stated that it was committed to vigorously enforcing its rights, and initiate a process of seizing Nigerian assets in order to recover the fund as soon as possible.
- Meanwhile, the Nigerian government is still on the backlog of investigations as revealed by earlier its disclosed its administrators.
- What this means is that the firm may soon announce its own terms of recovery if Nigeria fails to act quickly in the interest of its economy that may suffer a setback.
- The firm terms of recovery may include Nigerian cargoes in the U.K, other vessels and the country’s foreign reserves.