"This case has, sadly, brought together a combination of examples of what some individuals will do for money," the UK court ruled.
On Monday, the Nigerian government dodged having to pay out as much as $11 billion to a British Virgin Island company after a London judge ruled that the arbitration award for a failed gas deal was won fraudulently.
The judge found that the massive arbitration award in favour of Process & Industrial Development Ltd. (P&ID) was tainted by bribes. "The awards were obtained by fraud," Judge Robin Knowles said in a ruling on Monday, adding, "The way in which the awards were procured was contrary to public policy."
Court document shows that Nigeria was able to establish a strong prima facie case that the 2010 gas project agreement between the government and P&ID "was procured by bribes paid to insiders as part of a larger scheme to defraud Nigeria".
While Nigeria won this case, the London court lamented the greediness of some Nigerian officials that would have cost the country $11 billion in damages.
"This case has, sadly, brought together a combination of examples of what some individuals will do for money," Mr Knowles said after establishing some Nigerian officials collected bribes in the deal.
The judge added that these officials were "driven by greed and prepared to use corruption; giving no thought to what their enrichment would mean in terms of harm for others."
Over the history of the matter, Nigeria has had many government agencies and individuals involved at different times and in different ways. These included officials in the Ministry of Petroleum Resources, Ministry of Finance, Ministry of Land and Urban Development, Ministry of Justice, the Office of Attorney General, the Nigeria National Petroleum Corporation (NNPC), National Petroleum Investment Management Services (NAPIMS), and some ministers.
The judge concluded that the people of Nigeria have been let down in "so many ways over the history of this matter by a number of individuals in politics and administration whose duty it was to serve them and protect them."
The P&ID deal
In 2010, the P&ID won a contract from the Ministry of Petroleum Resources to build a gas-processing plant in the southern city of Calabar. Nigeria was to supply the gas for free over 20 years and the two parties would split the processed resources. But Nigeria never provided the promised gas, and the plant was never built.
Then, P&ID successfully sued the Nigerian government for breach of the contract at an arbitration tribunal presided over by Lord Hoffmann, a retired senior English judge.
The legal dispute between Nigeria and P&ID ran for more than a decade. The contract was signed between Nigerian government officials and Michael Quinn, an Irish former band manager, and his business partner Brendan Cahill, to help the West African country turn its vast reserves of natural gas into power.
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The project never broke ground. Mr Quinn and Mr Cahill's offshore company, P&ID, in 2012 began arbitration proceedings against Nigeria for breach of contract.
P&ID ultimately won a $6.6 billion award from a panel of arbitrators in London, one of the biggest known payouts to a company from a sovereign state. That bill has risen to $11 billion with interest -- more than Nigeria's 2023 budgets for its health, education, and justice ministries combined.
In 2017, Nigeria challenged the awards on the grounds of liability and jurisdiction. The Nigerian government accused P&ID of bribery before, at, and after the time the parties entered into the Gas Supply and Processing Agreement for Accelerated Gas Development (GSPA), a court document shows.
It alleged that some of its lawyers at the time of the arbitration, including two lead counsel, were corrupted by P&ID.
But, P&ID in its legal filings denied the corruption allegations, arguing that it was a "contract which P&ID genuinely wanted to perform, and a genuine arbitration which [Nigeria] lost for reasons . . . [that] had nothing to do with any corruption."
However, on Monday, the judge said not only was the original gas contract tainted by corruption, but that P&ID officials also engaged in bribery to win the UK arbitration.
Monday's ruling has been commended by many Nigerian officials including President Bola Tinubu.
