The recent ruling by a UK court asking Nigeria to pay a hefty N3.2 trillion to a British company, or have its asset seized, will have profund implication for all Nigerians if executed, the finance minister, Zainab Ahmed, said Tuesday.
The government said it was rejecting the $8.9 billion arbitrarily award because the foundation of the contract, in terms of conception and execution, was flawed.
The country made its position known at a press conference in Abuja attended by the Ministers of Justice, Abubakar Malami; Finance, Mrs Ahmed; and Information and Culture, Lai Mohammed.
"It's beyond trying to compensate for commercial interest. It's an assault to each and every Nigerian," said Mrs Ahmed.
"We take comfort in the efforts so far by Justice Ministry to get the judgement set aside because the consequences will be unpleasant for each and every Nigerian," she said.
A fortnight ago, the United Kingdom, Business & Property Courts (the Commercial Court), presided by Justice Butcher granted a British gas firm, Process & Industrial Development Limited (P&ID) request to enforce a March 20, 2013 award by a District Circuit Court in Washington DC against Nigeria.
The company had accused the Nigerian government of breaching a 2010 gas supply contract agreement for the construction of a gas processing plant.
In August 2012, the company said it served notice of arbitration after attempts to settle the matter out of court failed.
The U.S. arbitral court handed an initial award of $6.6 billion as damages in favour of P&ID. But, following Nigeria's refusal to enter an appeal for over five years, the award attracted an additional $2.3 billion in accumulated interest at 7 per cent rate per annum.
Nigeria's Attorney general of the Federation and Minister of Justice, Mr Malami, said on Tuesday the Federal Government was opposed to the award to P&ID because the conception and execution of the contract was "fundamentally flawed" from the beginning.
The minister said investigations into the circumstances that led to the controversial contract had indeed become necessary in view of certain antecedents relating to its conception and eventual award.
"Insinuations abound that the contract was originally designed to fail fundamentally against the background that there were inherent elements of breaches in it right from inception," Mr Malami told journalists in Abuja.
"When I talk of inherent elements of breaches, I want to draw attention to the fact that the composition of the parties in the agreement was flawed. There were two parties only - the P&ID and Federal Ministry of Petroleum Resources.
"In view of the fact that the Federal Ministry of Petroleum Resources is not a gas producer, not involving either the international oil companies or the Nigerian National Petroleum Corporation (NNPC) was ground to know it was designed to fail.
"When one conceives, signs and executes a contract to supply gas without involving the IOCs, NNPC as a party in the agreement, how do you intend to execute the project?" he asked.
He said the country could not have signed an agreement to provide a product one does not have.
"The Federal Ministry of Petroleum Resources does not have oil wells or gas reserves. So, how can the Ministry sign an agreement without bringing on board the custodians and producers of the gas to be supplied for the project?" he asked.
"It is against this background that we feel there is need for a comprehensive criminal investigation into the contract to unravel what undertones are indeed criminal.
"That the contract was originally designed not to succeed, and entered into by parties that were not entitled to execute such agreement. It is not out of place to embark on a wholescale criminal investigation to establish if there are elements of local or international conspiracy to subject Nigeria to serious economic loss."
Also present was the Central Bank of Nigeria governor, Godwin Emefiele.
In her remarks, Mrs Ahmed described the award as "very weighty", as it is equivalent to about N3.2 trillion, about the amount in the national budget allocated to personnel cost.
Apart from being "unreasonable, excessive and exorbitant," the Finance Minister said the award was also unfair and an assault on every Nigerian.
"It's beyond trying to compensate for commercial interest. It's an assault to each and every Nigerian. We take comfort in the efforts so far by Justice Ministry to get the judgement set aside because the consequences will be unpleasant for each and every Nigerian," she said.
The CBN governor dismissed claims by P&ID that it invested about $40 million in the project.
He said as the government's banker, the CBN was aware that as a foreign company, P&ID would not execute any contract or a project in Nigeria without following the various options available to bring in its investment.
"We have gone through our records. We don't have any information to show that this company (P&ID) brought in one cent into this country. We have accordingly written to the EFCC (Economic and Financial Crimes Commission) and the intelligence Department of the Nigerian police, which are currently investigating this matter," Mr Emefiele said.
"If they (P&ID) have proof of their investment, we are calling on them to please come forward and provide us evidence of how they invested $40 million in this country," he said.