Stations
Watch Live Listen Live

Nigerian National Petroleum Corporation, NNPC, on Tuesday, said it has been granted an acquit by the Supreme Court of the United Kingdom over a $100 million Bank guarantee that involved the Corporation and a service company, IPCO (Nigeria) Limited.

Vanguard reports thatThe NNPC, in a statement by its Group General Manager, Group Public Affairs Division, Mr. Ndu Ughamadu, said the acquittal was the latest in the prolonged dispute that arose from the contract between NNPC and IPCO for the construction of the Bonny Export Terminal (BET) Project in Port Harcourt, Nigeria.

The NNPC said the development was relevant in the history of the case as the English Supreme Court not only discharged NNPC from the responsibility of sustaining additional security of US$100million in favor of IPCO but it also concurred with the English Commercial Court and the Court of Appeal that NNPC has a good proof that IPCO procured the Arbitral Award by fraud.

It stated that the Supreme Court has stated the limits of an enforcing Court’s power to order security as a condition on the right make decisions on a properly arguable challenge under the New York Convention 1958 and the English Arbitration Act 1996.

Mr. Maikanti Baru, Group Managing Director of the NNPC, the new development delighted him, he commended the efforts of the legal team that secured judgment in favor of the Corporation.

Baru said everything possible would be done to extricate NNPC from the impediment that may hinder its access to hard earned funds which are needed to execute developmental projects by the various tiers of government in the country.

Ughamadu said the IPCO had referred its claims to arbitration in Nigeria and obtained an Arbitral Award of $154 million in 2004, with annual interest running at 14%, leaving NNPC with no option than to challenge the award at the Federal High Court in Lagos.

According to him, since 2004, IPCO had repeatedly sought to enforce the award in England prior to the conclusion of NNPC’s challenge of the Arbitral Award in Nigeria. He said, “It would be recalled that in 2008, during one of IPCO’s attempts to secure an order for the enforcement of the Award in the UK, NNPC discovered evidence that IPCO had forged documents relating to the claims and the related arbitration in Nigeria, and as a result, the parties agreed in 2009 to adjourn the enforcement proceedings in England, in order to await the determination of the fraud allegations in Nigeria.

 “In 2012, IPCO again applied to the English Commercial Court to enforce the award despite the agreement on the adjournment of the enforcement action. IPCO’s application was however, dismissed on March 14, 2014, holding inter alia that NNPC had made out a good prima facie case of fraud giving NNPC a realistic prospect of proving that the whole award should be set aside. IPCO however appealed to the UK Court of Appeal.

“In 2015, the UK Court of Appeal decided that the delays in the Nigerian proceedings required the English Court to lift the adjournment and to decide whether to allow enforcement following a trial of the fraud allegations in the English Court.

“Both the Commercial Court and, the Court of Appeal concluded that the fraud allegations against IPCO were made bona fide, that NNPC has a good prima facie case that IPCO practised a fraud on the Arbitral Tribunal, and that NNPC has a realistic prospect on that basis of proving that the whole award should be set aside.

“However, the UK Court of Appeal ordered NNPC to provide an additional security of US$100 million (NNPC having previously provided security of US$80million) as a condition of being entitled to advance a defence that enforcement should be refused because the award had been procured by IPCO’s fraud.

“Subsequently, NNPC appealed to the UK Supreme Court to decide whether the English court, as an enforcing court, is empowered to require security for money payable under the award (or any part thereof) from a party resisting enforcement of such award as a condition for being entitled to advance a good and arguable defence that enforcement would be contrary to English public policy because the award was procured by fraud.”

Read 25 times
Rate this item
(0 votes)

Media

Login to post comments

Newsletter

Enter your email address for signup as our newsletter.
               Whatsapp    

About Us

Nigeria Info FM, Your #1 Talk, News and Sports Station!”, the first station in its format in Nigeria. It proudly broadcasts local and international news with a blend of talk & sports shows, while addressing current affairs and topical issues.

Location

Nigeria Info Port Harcourt, 2, AIM Crescent, KM 16, East West Road, Rumuosi, Near Syringe factory, Port Harcourt.

Telephone:

234-84-901489