Although the Federal Government is reportedly considering negotiating its way out of the $9.6 billion United Kingdom (UK) judgment debt, stakeholders in the oil and gas industry, including legal experts, yesterday discussed a multidimensional approach that may enable the government reverse or manage the judgment, which may cost the nation about N3 trillion.
While some legal experts called on the government to immediately file a stay of execution of the judgment, other stakeholders believed that the judgment could be re-negotiated, reduced and settled in a way of investment that would be beneficial to Nigeria and ease the level of impact that might arise from the development.
The Ministry of Petroleum Resources and Process and Industrial Developments (P&ID) Limited had reportedly signed a 20-year Gas Supply Processing Agreement (GSPA) in 2010.
But Minister of Information and Culture, Alhaji Lai Mohammed, said that the deal suffered a setback, leading to arbitration, where P&ID claimed that it posted a loss for the 20-year term of the GSPA.
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“In an interim award, the Arbitration Tribunal ruled that Nigeria has breached the contract. Though Nigeria successfully applied to have that award set aside by the Federal High Court in Lagos, the tribunal ignored this decision.
“Consequently, on January 31, 2017, the tribunal rendered its final award against the Ministry of Petroleum Resources in the sum of $6.597 billion.
“This was in addition to pre-award interest at the rate of seven per cent per annum, effective from March 20, 2013 and post-award interest at the same rate from the date of the award. This interest increased the size of the award to $9.6 billion,” Mohammed said.
A Senior Advocate of Nigeria (SAN), Chief Mike Ozekhome, said the order by a British court for the seizure of Nigeria’s foreign assets to satisfy a judgment debt would, if carried out, simply cripple Nigeria whose 2019 budget is N8.92 trillion.