ONE of the lawyers who compromised  Nigeria’s case against Process and Industrial Development (P&ID), a British engineering firm that has engaged the federal government  in legal tussle  for years is Olasupo Shasore, SAN, a former attorney general of Lagos State.

A document obtained by The ICIR  which reveals the detail of the London court proceeding shows that Shasore who contested for the governorship of Lagos State in 2015, sold a dummy to the Nigerian government whom he represented, despite collecting a legal fee of $2 million for arbitration and disbursements.

In 2014, Nigeria sought the services of the former attorney general of Lagos State to serve as a counsel in a controversial case against P&ID.

Shasore, who at the time worked at Ajumogobia & Okeke, a law firm, kept his involvement in the case hidden and ran it through a different firm, Twenty Marina Solicitors, which was used to provide secretarial services, according to evidence submitted to Economic and Financial Crimes Commission (EFCC) by senior partner of the firm.

On two different occasions, Twenty Marina Solicitors, under the guidance of Shasore, didn’t enter a defence for Nigeria.

A compromised Shasore?

According to the document, while the Tribunal granted a jurisdiction award to P&ID, Twenty Marina Solicitors had emailed the Tribunal stating that it would not be able to lodge Nigeria’s skeleton argument by the deadline or attend the jurisdiction. It also didn’t request for an adjournment of the hearing.

When P&ID served its statement of case on liability June 28 2014, Nigeria was ordered by the Tribunal in July of that year to submit its statement of defence with a deadline pegged at September 2014. Nigeria missed the deadline and never served its statement.

All the while, Shasore pushed for Nigeria to settle. In a letter written to Mohammed Bello Adoke, former Attorney General of Nigeria, Shasore said “there appears to be a lack of exonerating facts or any documentary evidence with which to defend the claim” and further urged a “possible settlement”.

Subsequently, a letter was sent to Allison-Madueke, the minister of petroleum resources, submitting that Nigeria had a ‘bad case’ and should pursue settlement.

On 11 November 2014 Folakemi Adelore, legal adviser to the Ministry from 2013 to 2017, sent a memorandum to the permanent secretary of the Ministry recommending a settlement with P&ID.

On 18 November 2014, US$100,000 of cash was deposited into Adelore’s account in ten US$10,000 tranches, a payment Shasore admits to have deposited.

There was also an equivalent payment of US$100,000 by Shasore to Ikechukwu Oguine, who was the coordinator, legal services at the NNPC.

In December 2014 Shasore, Adelore and Oguine travelled to London for settlement negotiations with P&ID. It failed.

In furtherance, Shasore filed Nigeria’s statement of defence in February 2015, missing an earlier granted extended deadline of October 3, 2014. On April 16, 2015 Shasore wrote again to Adoke, stating that the Ministry’s defence was in “grave need of evidence, documents and witnesses”, and asking for an “urgent response” on a proposal to settle the claim.

In response to Procedural Order No.8 directing Nigeria to serve its evidence and supporting documents by May 1, 2015, Nigeria served the witness statement of Oguine, legal coordinator at the NNPC. The statement explained why Nigeria was unable to supply gas to P&ID and argued that its only role was as a “facilitator” between P&ID and the oil companies. There were no exhibits to the statement, the court document revealed.

On May 12, 2015 Shasore served Nigeria’s statement of disputed facts. ‘In substance they occupied less than a page and were six in number’ and it’s ultimate ruling, the Tribunal dismissed Shasore’s defences to the claim.

The beginning – establishment of P&ID

Process and Industrial Developments Limited (P&ID) was first incorporated in the British Virgin Islands on May 30, 2006 by two british citizens identified as Michael Quinn and Brendan Cahill. Two months later, in July of the same year, an associated company, Projects & Industrial Developments P&ID (Nigeria), was established.

According to the court document, ‘P&ID had no assets, only a handful of employees, and was without a website or other presence.’

However, this didn’t stop it from signing a deal with T. Y. Danjuma, a prominent Nigerian businessman in June 27, 2006, to undertake a project that was labelled Project Alpha. Project Alpha concerned the design of a polypropylene plant in Badagry, south-west Nigeria.

Subsequently,  a further engineering service agreement was signed on September 6, 2006 with Danjuma’s company, Tita-Kuru Petrochemicals Ltd. For its services, Tita-Kuru in a letter to the Economic and Financial Crimes Commission (EFCC) in 2019, disclosed that it paid P&ID $40 million for its development of the Engineering work, Design and Off-take Consultancy Services required to organise a gas offtake agreement from the Folawiyo gas field at Badagry, However, the British engineering informed Danjuma’s company that it was unsuccessful in its bid despite carrying out the design.

In October 2008, Quinn, made a design presentation entitled “Propylene & Butane for Export, Phase 1” and “Propylene & Butane for Export, Phase 2 to the Federal Ministry of Petroleum Resources. Both computer aided design drawings were labelled ‘Project Alpha’

P&ID submitted the designs as a first step in negotiating the now-controversial GSPA contract.

GSPA agreement was signed in January 2010 but was never implemented

In January 2010, the GSPA contract between Nigeria and P&ID was signed by Rilwanu Lukman, former minister of petroleum resources and Quinn.

By manner of the agreement, P&ID was expected to construct and operate an Accelerated Gas Development project, while the Nigerian government was to supply natural gas (“wet gas”) at no cost to P&ID’s facility.

“It would process the gas to remove natural gas liquids – which P&ID was entitled to – and return lean gas to Nigeria at no cost, which would be suitable for use in power generation and other purposes.

“The contract was to run 20 years from Nigeria’s first regular supply of natural gas to the facility.”

Where it gets complicated – No gas facility, no wet gas provision

While the agreement was set in motion, a lack of implementation on both sides floundered the deal. In its argument, P&ID submitted that it had taken steps to ensure the implementation of the GSPA agreement.

On 14 May 2010 Quinn, had sought assistance with the negotiations Addax Petroleum, who were to provide the flared wet gas for the project from Rilwan, the then-managing director of the Nigerian National Petroleum Corporation (NNPC), Nigeria’s state oil corporation.

The letter stated that all necessary project finances were in place, 90 percent of the engineering designs were complete, a 50 hectare site had been allocated to P&ID by the Cross River State government, and Addax had confirmed its readiness to the Ministry to supply wet gas for the project but Rilwan was replaced by Diezani Alison-Madueke in March 2010, and consequently freezing progress of the agreement.

Between 2010 and 2012 P&ID wrote a number of letters to the Ministry, the NNPC and the President seeking implementation of the GSPA but nothing happened.

“During the course of the next two years, we made good progress and reached a very advanced stage of the preparatory engineering work necessary to implement such a project on the ground.

“I would estimate that the total costs sunk into the preparatory work during that period were in excess of US$40 million, including initial feasibility studies, the cost of licences for the technology required to operate the gas stripping plant and the polypropylene plant respectively, the production of detailed engineering drawings and our own internal project management costs,” Quinn said.

In August 2012, P&ID served Nigeria with a Notice of Arbitration. In its argument, it submitted that the Nigerian government had frustrated all its effort to implement the GSPA, stating that it failed to provide ‘wet gas’ and pipeline to transport the end product. It added that Nigeria was therefore liable for the loss of its projected profit which was to be secured within the period of twenty years of operating in the country.

In its initial defence, Nigeria argued that it acted only as a facilitator between P&ID and Addax Petroleum, which was to provide the wet gas. It further submitted that “the failure of P&ID to acquire the site and build Gas Processing Facilities was a fundamental breach and that no gas could be delivered until this has been done.”

New regime 

Upon winning the 2015 election, President Muhammadu Buhari appointed Abubakar Malami as the Attorney General and Minister of Justice in November 2015.

After admittedly studying the arbitration case file, Malami submitted that he recognised lapses in the case and in December 2015, Nigeria applied to the Tribunal, seeking for the the ‘Liability Award’ judgment to be overturned on grounds of internal inconsistency in the Tribunal’s reasoning, the Tribunal’s failure to deal properly with the authority argument, and the Tribunal’s failure to give reasons that Nigeria’s breach was repudiatory.

However, the application was rejected on grounds that it was more than four months after the expiry of the 28 day time limit for appeal and that Nigeria had not shown compelling reasons for an extension.

Reactionary, Nigeria filed an originating motion in the Nigerian Federal High Court on February 24 2016, seeking for extension, setting aside and/or remitting for further consideration all or part of the ‘Liability Award’ judgement.

It further sought an order restraining the parties from participating in the arbitration, pending the court’s determination of the application. Its request was granted on April 20, 2016.

In the same year, Shasore was replaced by Bolaji Ayorinde SAN and Malami disclosed that Shasore had failed to cooperate properly in handing over material of the case.

Attempt at settlement failed

Progressively, Malami, in March 2017, submitted different recommendations to Yemi Osinbajo, who was acting president at the time, exploring five “scenarios” and making recommendations on each.

The first was to negotiate a reasonable settlement. The second was to undertake a “forensic and extensive examination of the original contract, Award and other Processes to discover loopholes to upset or vary the Award.” The merits were said to be that a loophole might be discovered, for example fraud, technical grounds or a conflict of interest of the arbitrators. The other options were to inquire whether there was the possibility of an appeal, an investigation by the EFCC and a challenge to the recognition and enforcement of the award.

On April 6, 2017 the acting president approved its proposal to pursue settlement negotiations. However, settlement negotiations didn’t work out. A second attempt at settlement with P&ID in 2018 was also unsuccessful.

Prima facie case of fraud

In February 2016, Malami, asked the EFCC to investigate P&ID.

While carrying out interviews during its investigations, the EFCC uncovered that Tijani, who was a member of the NNPC’s technical committee when the GSPA agreement was entered, received bribes from P&ID in return for overlooking shortcomings in its bid. Tijani received two payments from Lurgi totalling around £30,000 in April 2014 and April 2015, the document revealed.

However, in response to a letter from Tijani in December 2019, the Attorney-General entered a non prosecution agreement with him on January 8, 2020.

During its inquiries EFCC obtained bank statements and Swift records of interbank payments in relation to various accounts. Among the information obtained from September 2019, and the date EFCC obtained it, it was found that Taiga, who was a senior legal adviser to the NNPC at time of the GSPA, received two cash transactions of US$10,400 and US$6,500 into her Access Bank account.

Taiga said the payment may well have come from the sale of a car or property from her late mother’s estate, she also said that the US$6,500 may have been a loan from a family member intended for her daughter

There were payments in 2017 into her Zenith Bank account from Eastwise and ICIL. Her daughter received payments from ICIL, Ireland, in March 2019.

Ibrahim Lukman, the former minister of petroleum resources opened a US Dollar account at GTBank on January 16, 2009, with an initial cash deposit of US$10,000. He then deposited a further US$10,000 of cash into another GTBank account on April 8, 2009, EFCC investigations showed. He died in 2014.

Ibrahim Dikko, a member of the technical committee reviewing the GSPA, opened a US dollar account on April 28, 2008 under the name of his company, Equatorial Petroleum Coastal & Process Limited, with an initial cash deposit of US$10,000. There were further periodic cash deposits totalling US$69,300 until 2015.

On October 28 and December 1, 2008 there were also two cash deposits totalling N4 million into his personal account at Firstbank.

On August 28, 2019 the Federal Inland Revenue Service informed the EFCC that P&ID had not opened a tax file. The following month, on the Special Control Unit against Money Laundering reported that P&ID Nigeria had failed to register its activities with it.

Verdict

In its ruling, Cranston noted that Nigeria established a prima facie case of fraud against P&ID and granted a relief of sanction and extension of time.

However, the judgement is a temporary win for Nigeria, who now only has as an opportunity to persuade the court to review the new evidence of miscarriage of justice claimed by the government but still has to contend the award given to P&ID.