The House of Representatives has set up an ad hoc Committee chaired by Sada Soli (APC, Katsina) to investigate the recent judgment debt of $9.6 billion against Nigeria by a United Kingdom Court in favour of Process and Industrial Development (P&ID) Limited.
The House recommended appropriate sanctions where necessary without fear or favour or preference for status in line with Order 14 of the Standing Orders of the House, against those involved in the contract that led to judgment debt.
It further resolved to initiate a process of reviewing all Agreements and Treaties signed by Nigeria through the appropriate committees to create opportunities to discover anomalies and avoid a repeat in the future.
These resolutions were reached Wednesday during plenary, sequel to a motion on the urgent need to ‘Investigate the Act of Negligence in the Handling of the Process and Industrial Development (P&ID) Limited’s Transaction by the Ministry of Justice and Ministry of Petroleum Resources Respectively’, sponsored by Julius Ihonvbere (APC, Edo)
Ihonvbere, while presenting the motion said the House noted that the recent judgment debt of $9.6 billion (with daily interest accruing) by a commercial court in the United Kingdom against Nigeria, in a matter between Process and Industrial Development (P&ID) Limited left very sour taste in the mouth.
He stated that the House, “notes also that for a country with a foreign reserve of only $45 billion and a Sovereign debt profile of over $80 billion, this Judgment debt would not only negatively but would devastatingly affect the Nigerian economy.
“Aware of the fact that Nigeria has a penchant for disregarding the sanctity of contracts and terms of agreement, coupled with the failure of Nigeria representatives in many cases, to carefully or diligently scrutinize agreements they sign knowing that the consequences will affect past and future generations.
“Aware also that Nigeria had entered into a Gas Supply and Processing Agreement (GSPA) with P&ID Limited, in January 2010, through the Ministry of Petroleum Resources with the understanding that Nigeria would supply natural gas (wet gas) at no cost, through a government pipeline to P&lD’s production facility, while P&ID in return would construct and operate the facility, process the Wet Gas’and return to the government of Nigeria lean gas for the generation of power at no cost to Nigeria.
“Further aware that two years down the line, P&lD had not built any gas plant to which Nigeria could supply wet gas for processing, signifying in the first place that the move to Arbitration was opportunistic and grossly self-serving.
“Cognizant of the fact that the matter went before an Arbitration Tribunal, under the Rules of the Nigerian Arbitration and Conciliation Act 2004, with London, England as place of Arbitration. After affirming its jurisdiction in the matter, the Tribunal began hearing to determine whether or not there were any repudiatory breach of contract. At this point, there was an attempt by the Ministry of Petroleum to reach a settlement agreement with P&lD Limited to the tune of $850 million, payable in instalments which obviously was not diligently pursued.
“Alarmed that the agreement was somewhat shrouded in secrecy and as such apparently dubiously procured, as those who ought to know about its existence did not and more importantly, the relevant Laws in Nigeria for the transaction to be consummated was not applied especially, Part IV of the Bureau of Public Procurement Act 2007 which deals with the Fundamental Principles of Procurement.
“Further Alarmed that it took the new Nigerian government more than 4 months to respond to the vital arbitration judgement of about $6 billion with a ridiculous excuse that there had been a change of administration in Nigeria and that Ministers, including the Attorney General had only just been appointed thus asking for an extension of time to act on the outcome of the Arbitration Tribunal.
“Also alarmed that, rather than engage P&ID in the matter before the tribunal with robust legal arguments and interpretations, Nigeria was busy shopping for a favourite forum to plead her case in a court in Lagos, Nigeria.
“Worried that the lack of diligent prosecution of cases in which Nigeria is involved by those whose duty, it is to do so, is due to our tendency to either politicise everything or focus more on personal interests, or failure on the part all parties involved.
“Observed that Butcher, J. (the Judge in the matter) in his August 16, 2019 ruling made heavy weather out of several acts of omission on the part of the Nigerian authorities, especially when he noted that ”…the FRN had remedies for many procedural unfairness, but it did not utilise them”. Nigeria could also have objected to Procedural Order No. 12 or question the Final Award. In the words of Butcher J., ”it did neither and the time for doing so is long past.” These are serious indictments of the incompetence and gross negligence displayed by our representatives/agents/arbitrators in the matter.
“Further observed that this embarrassing judgement exposes a deep decay in our governance and leadership infrastructure with far-reaching implications for the credibility of the country’s capacity to handle business and legal cases”.
James Kwen, Abuja
