Nov. 3, 2022

…P&ID officials received privileged documents, says government
…Firm denies wrongdoing, says Nigeria evading legal obligations

The Nigerian government says British and Irish businessmen it accuses of fraudulently winning an $11 billion arbitration award previously used the same playbook to net a cash settlement from the West African country.

President Muhammadu Buhari’s administration is preparing for a trial in London early next year where it aims to prove that Process & Industrial Developments Ltd. secured a gas-supply contract and the subsequent arbitration victory through bribery.

Now, the government is expanding its offensive against the firm to include claims about its shareholders’ role in another dispute with the state that was also marred by corruption allegations.

P&ID denies all allegations of wrongdoing and accuses the government of evading its legal obligation to compensate the British Virgin Islands-registered company.

With interest, the award has grown from an initial $6.6 billion to the equivalent of nearly a third of Nigeria’s foreign reserves. If the government’s case fails, Buhari’s successor – who will be elected in February during the eight-week trial – may be forced back to the negotiating table with P&ID.

Nigeria alleged in its amended case filed in July that during arbitration proceedings, which ran for five years until 2017, two men who owned and worked for P&ID “obtained privileged and/or confidential documents” about the government’s entry into the 2010 gas deal, its strategy for defense and discussions about striking a settlement.

Seamus Andrew and Brendan Cahill were also receiving similar documents relating to the state’s battle with another company — IPCO (Nigeria) Ltd. — that was then trying to enforce a separate arbitration decision, according to a previously unreported reply that Nigeria submitted to the court in March.

Although neither man was a director or shareholder of IPCO, Nigeria alleges their companies financed IPCO’s dispute. Cahill founded P&ID while Andrew was the company’s lawyer during the arbitration phase and acquired 75% of the firm’s shares in 2017, through a Cayman Islands-registered firm Lismore Capital Ltd.

There is “a track record on the part of P&ID and the companies and individuals associated with it of obtaining such documents unlawfully for their own tactical advantage,” the Nigerian government told the court.

“Unfounded Allegations”

P&ID didn’t “pay bribes or corruptly collude with anyone” to obtain its opponent’s confidential information, the company responded in September. By email, Andrew denied having “ever unlawfully obtained documents from the Nigerian government” and rejected what he said were “unfounded allegations” against him.

IPCO’s dispute with the Nigerian National Petroleum Corp. arose from a disagreement over a 1994 contract for the construction of an export terminal, which resulted a decade later in an arbitration award of about $150 million. Nigeria alleged that companies belonging to Cahill helped fund IPCO’s arbitration.

Cahill denied that claim in a witness statement, saying IPCO committed to paying one of his firms an outstanding invoice once it settled with the NNPC Limited. Cahill said he introduced IPCO to a “funder” for the enforcement proceedings. That financier, says Nigeria, was Lismore Capital.

Cahill didn’t respond to requests for comment.

“Good case”

While UK judges concluded the NNPC had a “good” case that IPCO fraudulently obtained part of the award, the state-owned oil company resolved the matter by paying IPCO a settlement of tens of millions of dollars shortly before a trial was due to start in 2018, according to Cahill’s witness statement. The NNPC wouldn’t confirm the payout.

Nigeria’s claims about the alleged involvement of Andrew and Cahill in the IPCO proceedings are “wholly irrelevant,” P&ID said in September and may ask the court to strike them out.

Courtesy: Bloomberg