The Federal Government has said an International Chamber of Commerce tribunal in Paris has dismissed a $400 million arbitration claim linked to the long-stalled Mambilla Hydroelectric Power Project, ruling that the settlement agreement at the heart of the case was not binding on the federal government and was tainted by corruption.
The September 17 final award rejected claims brought by Sunrise Power and Transmission Co. Ltd. and its principal, Leno
Adesanya, according to a statement from Attorney-General and Justice Minister Lateef Fagbemi.
Sunrise had sought $400 million, consisting of a $200 million settlement amount and an additional $200 million default payment, plus interest at 10% a year compounded daily, the government said.
Fagbemi said the tribunal found that former ministers who signed the settlement agreement and a related addendum lacked presidential authorization to bind Nigeria, the Justice Ministry said.
It also held that the agreement was procured through corruption and could not be enforced under Nigerian public policy.
The decision concerns the proposed 3,050-megawatt Mambilla hydroelectric project, a flagship power-development scheme that has been delayed for years by rival contractual claims, court cases and arbitration proceedings.
The Attorney General has explained that the Paris-based tribunal rejected Sunrise’s claims in their entirety after finding that the officials who executed the settlement documents did not have the authority required to commit the federal government.
Under Nigerian law, the tribunal concluded, presidential approval was necessary before the agreement could impose obligations on the state, according to the attorney-general’s statement.
The tribunal also found that corruption surrounding the Mambilla project extended to the settlement agreement on which Sunrise based its claim, the government said.
According to the statement, the tribunal determined that Adesanya had engaged in a prolonged pattern of bribery involving senior Nigerian public officials connected with the project.
Minister Fagbemi said the tribunal concluded that the alleged conduct affected the agreement itself, rendering it contrary to public policy and unenforceable.
Sunrise and Adesanya couldn’t immediately be reached for comment.
The tribunal ordered Sunrise and Adesanya to pay 75% of Nigeria’s legal costs and expenses, with interest at 10% a year compounded annually, Minister Fagbemi said.
The tribunal expressed hope that the costs order would deter further unmeritorious claims against Nigeria, according to the government’s statement.
Fagbemi said the ruling underscored Nigeria’s intention to challenge contractual and arbitration claims it considers fraudulent or opportunistic.
“The Federal Republic of Nigeria will not be a soft target for predatory litigation and arbitration,” Minister Fagbemi said.
He credited President Bola Tinubu with supporting the government’s legal defence and providing financial and logistical backing for the proceedings.
The dismissed case is separate from another arbitration in which Sunrise is seeking more than $2.7 billion from Nigeria in relation to the Mambilla project.
The dispute has been a significant obstacle to efforts to revive the project. Nigeria has said funding discussions with the Export-Import Bank of China were contingent on resolving the legal claims, preventing the project from reaching financial close.
The Mambilla scheme, planned for Taraba State, is expected to have a generating capacity of 3,050 megawatts.
NewsQuest reports that if completed, it would rank among Nigeria’s largest hydroelectric projects and form a major part of the government’s plan to expand electricity supply through renewable generation.
The latest award could remove one legal barrier to restarting the project, though the separate multibillion-dollar arbitration claim remains unresolved.
