P&ID: British court orders release of $200m guarantee to Nigeria

A United Kingdom Commercial Court on Tuesday ordered the release of the $200m guarantee put in place as security in respect of the execution of the much-discredited Process and Industrial Development $10bn arbitral claim.

The Central Bank of Nigeria revealed this via its official Twitter handle, @cenbank.

The apex bank also said the court awarded a £70,000 cost in favour of Nigeria in addition to an earlier award of £1.5m.

It wrote, “Nigeria’s foreign exchange reserves was this morning boosted by over $200 million when the London Commercial Court ordered the release of the $200 million guarantee put in place as security in respect of the execution of the much discredited P&ID $10 billion arbitral claim.

“The court also awarded a £70,000 cost in favour of Nigeria in addition to an earlier award of £1.5m.”

It was earlier reported that a UK court also ordered the P&ID to pay £1.5m to Nigeria within 21 days.

Justice Ross Cranston had in a landmark judgment, on September 4, granted the Federal Government permission to challenge the final arbitral award delivered by a London arbitration tribunal in favour of P&ID and against Nigeria in January 2017.

The judge, in the judgment, agreed that there was prima facie case of fraud in the agreements leading to the award which should be inquired into.

The award which stood at $9.6bn as of 2019 has risen to $10bn.

The tribunal had held Nigeria liable for the alleged breach of a Gas Supply Processing Agreement it entered into with P&ID in 2010.

But the Nigerian government had approached the UK court requesting an extension of time within which to challenge the final arbitral award on the basis that the GSPA and the award were tainted by fraud.