~~ Premium Times
On Tuesday, a U.S. District Court in Washington D.C. gave judgment affirming a $6.59 billion arbitral award, plus $2.30 billion interest, against Nigeria.
The judgment was given after the country failed to show up in court to defend the matter.
The naira value of the amount came to about N2.7 trillion (at the Central Bank of Nigeria’s rate of N306 to one U.S Dollar).
Just as the judgment was handed down, PREMIUM TIMES became aware that the country would have paid less than 10 per cent of the $8.9 billion award if the Muhammadu Buhari administration had acted in line with the recommendation passed to it by the preceding Goodluck Jonathan regime.
But rather than take the recommended action, the Buhari administration scorned at the settlement agreement its predecessor signed with Process & Industrial Development Limited (P&ID), the engineering firm fighting Nigeria for breach of contract.
Official documents reviewed by PREMIUM TIMES show that a government negotiation team constituted by Mr. Jonathan successfully negotiated an out-of-tribunal settlement with P&ID and got the company to accept an $850 million payment, about 9.6 per cent of the $8.9billion award.
However, the present administration ignored that settlement and rather asked its lawyers to return to the tribunal to further contest the engineering firm’s claims.
The tribunal then ruled against Nigeria, awarding $6.6 billion in favour of the British Virgin Island’s firm.
The refusal to settle the matter for over five years attracted additional $2.3billion in accumulated interest at seven per cent per annum.
The fine followed a dispute over alleged breach of contractual agreement by the Ministry of Petroleum Resources and the Nigerian National Petroleum Corporation (NNPC).
Officials familiar with the matter told this newspaper that the Jonathan government hammered out the $850 million agreement with P&ID a few days to the end of its reign.
It then transferred the responsibility of disbursing funds to the aggrieved company to the then in-coming government of President Muhammadu Buhari.
Former President Goodluck Jonathan
“President Jonathan reasoned that since his administration was already a few days away from its exit on May 29, 2015, it was proper not to approve the payment of $850 million to avoid unnecessary suspicion,” one official said, asking not to be named because of the sensitivity of the matter