The UK Commercial Court has granted the Nigerian government's application for a 'stay of execution' of a judgement debt.
The court also granted the Nigerian government's request for leave to appeal its ruling endorsing the UK Arbitration Tribunal's decision.
PREMIUM TIMES reported how the UK court ruled in favour of an Irish firm, P$ID, that Nigeria was to pay the firm about $9 billion for contract violation.
The Nigerian government has described the agreement as fraudulent and secured Nigerian court judgement against P&ID. A former petroleum ministry official involved in negotiating the contract is also being prosecuted.
Approving Nigeria's request for a "stay of execution" will prevent P&ID, from enforcing the UK Arbitration Tribunal's earlier judgment while this case is heard on appeal before the Court of Appeal.
Speaking on Thurdday's ruling, Attorney General Abubakar Malami said. "I am pleased with today's development in the court and see this as a positive resolution that constitutes an important step in the Government's efforts to defend itself in a fair and just process.
"We look forward to challenging the UK Commercial Court's recognition of the Tribunal's decision in the UK Court of Appeal, uncovering P&ID's outrageous approach for what it is: a sham based on fraudulent and criminal activity developed to profit from a developing country."
The contract for gas supply and processing (GSPA) was signed by the administration of late President Umaru Yar'Adua and P&ID.
The company was to build gas processing facilities around Calabar, Cross River State, and the government was to supply wet gas up to 400 million standard cubic feet per day. The agreement defined wet gas as "associated gas removed, during oil production, having a propane content of not less than 3.5 mol per cent and a butane content of not less than 1.8 mol content, compressed and delivered via pipeline to the site."
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In turn, the company "shall operate and maintain the GPFs (gas processing facilities) on a professional basis to ensure a regular supply of Lean Gas (approximately 340 MMSCuFD) for power generation." Lean gas, defined as "pipeline quality gas having a composition of not less than 95 mol per cent of methane and ethane," was what the government was to take after supplying wet gas for processing by the company.
PREMIUM TIMES reported how the agreement was designed to fail as key elements necessary for its success was missing.
A three-member arbitration panel that reviewed the contract had ruled against Nigeria and ordered the government to pay the firm $6.6 billion as damages.
The British court last month ruled against Nigeria's objection to the 2017 arbitration.
The money with interest has now accumulated to about $9 billion (approximately N3.24 trillion), over one-third of Nigeria's 2019 budget.
The judgement was delivered by Justice Butcher of The High Court of Justice, Business and Property Courts of England and Wales.
Nigeria has since condemned the ruling and said it suspects that various officials involved in the negotiations did so for pecuniary reasons.
Thursday's ruling has now granted a stay of the earlier ruling by the British court.
More details later...