A London Commercial Court in the United Kingdom has ordered the release of the $200 million guarantee put in place as security in the case against Process & Industrial Development (P&ID), to the Nigerian government.
P&ID had sought to increase the security to $400 million, but the court presided over by Justice Ross Cranston rejected the request and ordered cost of £70,000 against P&ID in addition to an award of £1.5 million earlier in September. The £1.5 million was to cover legal costs the Federal Government incurred as part of its successful application for the extension of time to challenge the arbitration award and procedural hearing earlier in the year.
In a series of tweets via its verified Twitter handle on Tuesday, the Central Bank of Nigeria (CBN) said the nation’s foreign exchange reserves was boosted by the award.
“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 tweet read.
The court also awarded a £70,000 cost in favour of Nigeria in addition to an earlier award of £1.5m.
— Central Bank of Nigeria (@cenbank) September 29, 2020
“Due to the substantial evidence of prima facie fraud established before the court, we are pleased that the judge has agreed to release the guarantee. We are also pleased that the court has rejected P&ID’s application to increase the guarantee, which was clearly intended to be a diversionary tactic and entirely misconceived,” the bank’s governor, Emefiele was quoted as saying.
He said Nigeria will not rest until justice is secured for the Nigerians.
“This release which is accretion into the reserves will further enhance the nation’s management of the exchange rate of its domestic currency, the naira,” the governor said.
“This is a further and significant victory for Nigeria in our ongoing fight to overturn the $10 billion award procured through fraud and corruption by P&ID and former government officials.
“P&ID and its backers, Lismore Capital and VR Advisory, are increasingly seeing their case slip between their fingers. They continue to resort to employing delay tactics, disseminating misleading claims, and taking every step to obstruct our investigations across multiple jurisdictions.
“The FRN will not rest until we secure justice for the people of Nigeria – no matter how long it takes. Investigations are ongoing, and we are confident that more of the truth will be revealed over the coming months.”
Nigeria posted the $200 million bond in November 2019 in compliance with a court judgement to a get a stay of execution.
P&ID had won a $6.6 billion arbitration award after the 2010 gas deal collapsed. The award had been accruing interest since 2013 and is now worth $10 billion.
Justice Cranston 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.