$9bn fine: FG ready to negotiate new terms of agreement

The federal government of Nigeria says it’s ready to negotiate and meet the terms of the agreement reached with genuine investors over the $9bn arbitration awarded by a UK court to P&ID.

Attorney General of the Federation, Abubakar Malami who disclosed this during a press briefing on Television Continental (TVC), described the failed contract resulting in the $9b judgment as scam designed to inflict economic and financial loss on Nigeria.

The Attorney General also made a promise to the citizens that none of the nation’s assets would be confiscated as steps were being taken to investigate circumstances surrounding the judgement.

Recall that in 2010, Process and Industrial Development (P&ID) signed a contract with the Federal Government under the administration of President Dr Goodluck Jonathan to supply gas to a processing plant in Calabar.

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.

In 2013, P&ID reportedly won a $6.6 billion arbitration case against Nigeria. The figure was calculated based on what the company was estimated to earn over the course of the 20 years agreement. However, with the accumulated interest payments, the sum now tops $9 billion, which amounts to 20% of Nigeria’s foreign reserves.

The bottom line: The founder of P&ID, Brendan Cahill denied that the agreement signed with the Federal Government in 2010 was fraudulent. He said the arbitrators in London spent five years carefully reviewing the written agreement and all the facts surrounding the deal, concluding unanimously that Nigeria was to blame for the collapse.

The new reaction by the Abubakar Malami has, however, cast doubt on the veracity of the claims of P&ID while raising a question on who is telling the truth in this matter.