The fraudulently obtained $11 billion arbitration award against Nigeria over a failed gas deal “should not have come into existence” and must be struck down, a judge said, in a sharply critical ruling over the winning company’s conduct during secret London legal proceedings.
After finding in October that the massive arbitration award in favor of Process & Industrial Development Ltd. was tainted by bribes, the judge said Thursday the case cannot be sent back to the arbitration tribunal. The court also denied P&ID the permission to appeal the ruling.
“It is because of the behavior of P&ID,” that there is “no real prospect of justice being done” by sending the case back to the arbitration tribunal, Judge Robin Knowles said on Thursday. “Things have gone so far and so deep that that I am satisfied that it would be inappropriate to remit the matters in question to the tribunal for reconsideration.”
Nigeria’s government had dodged the massive liability in the October ruling that also sparked a debate this week in the House of Lords about the secrecy of proceedings in the privately set up arbitration courts. The ruling was a relief to Africa’s biggest crude producer’s economy fighting inflation and falling oil revenues.
A lawyer for P&ID didn’t immediately respond to an emailed request for comments. The firm had consistently denied all the allegations made by Nigeria.
At the heart of the case is a failed 2010 gas deal between Nigeria and P&ID, a British Virgin Islands-registered firm founded by two Irish businessmen and later backed by hedge fund chief Richard Deitz’s VR Capital Group Ltd. A resulting arbitration led to a $6.6 billion award for P&ID that swelled to over $11 billion with interest.
VR Capital had entered a $45 million deal for a 25% stake in P&ID after the arbitration ruling but then fell out with the other owners of P&ID and commenced its own arbitration case against it in 2020, according to US court filings. A spokesperson for the firm didn’t immediately comment.
“Justice has been served,” Nigeria’s spokesperson said in an emailed statement. “Today’s decision has drawn a final end to this saga, and will also serve as an important message to those individuals or entities who would seek to defraud the people of Nigeria.”
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