An Irish-owned firm, Process and Industrial Developments Ltd (P&ID) was today granted court permission to seize up to $9bn (£7.4bn) in assets belonging to the Nigerian government.
Mr Justice Christopher John Butcher of the British Commercial Court said that the firm can take 20 per cent of Nigeria’s foreign reserves, a move that would deal a devastating blow to the Nigerian economy.
In 2010, the company struck a deal in which the Nigerian government would supply gas to a processing plant in Calabar, built and run by P&ID, formed by two Irish businessmen.
The government failed to fulfil its side of the agreement.
However, in 2013 P&ID won a $6.6bn arbitration case. The figure was calculated based on what the company was estimated to have earned over the course of the 20-year agreement.
But P&ID now says interest accrued means it is owed $9bn.
Today’s decision means that the arbitration has been converted into a legal judgement, allowing P&ID to attempt a seizure of the assets, according to a report by City A.M
Lawyers representing the Nigerian government argued the award should not be enforced because England was not the correct place for the case, and even if it were, the amount awarded was “manifestly excessive.”
Justice Butcher rejected these arguments and said he would “receive submissions from the parties as to the precise form of order appropriate.”
“P&ID is committed to vigorously enforcing its rights, and we intend to begin the process of seizing Nigerian assets in order to satisfy this award as soon as possible,” said Andrew Stafford, Q.C. of Kobre & Kim, which represents P&ID.
In 2012, P&ID took the government to arbitration over the failure of the deal and won the award, which was based on what it could have earned during the 20-year agreement.
Stafford said that with accrued interest, the award now tops $9.6 billion.
Reuters previously quoted legal experts as saying that assets used for diplomatic purposes – such as the Nigerian High Commission building in central London – are not eligible for seizure, but commercial assets are.
In Case You Missed It