P&ID: Nigeria Has Secured Variation On Payment Of $200m Security – AG Malami
Nov. 30, 2019
ABUJA – The Federal Government on Friday stated that it has succeeded in securing a variation of the UK court order requiring Nigeria to pay the sum of $200 million as security for obtaining a stay of execution of an arbitral award granted in favour of Process and Industrial Development Ltd. (P&ID).
Instead of paying the sum by direct cash deposit, it is now to provide it as bank guarantee, Abubakar Malami, the Attorney General of the Federation and Minister of Justice, said.
Malami stated that the Federal Government had appealed against the payment of the $200m security component which was a condition for stay pursuant to the judgment of a British Commercial High Court which confirmed the arbitral award of $9.6 billion to P&ID against Nigeria.
Malami explained that following the FG’s appeal, the Court granted the request for variation of terms of the order seeking to provide bank guarantee in place of direct cash deposit.
“Our application for variation of the order was allowed and we are as a result, not making cash deposit but posting a bank guarantee,” the Minister said.
“We remain in control of our funds by the act of acceptance of the guarantee. The Government is not paying the $200m cash but positing a bank guarantee by the variation of the order.
“The advantage of the variation in the judgment from direct deposition of cash to posting of bank guarantee is that the money and its control reside in the Federal Government unlike when otherwise.
“The success recorded so far in relation to the $200 million security deposit is that the amount of money remains in our custody, and we are simply providing a document. It is only when our case did not succeed, which we never anticipate, that the court can order the withdrawal of the amount as stated in bank guarantee.”
Malami said the Federal Government requested the change in the method of paying the security deposit because it believes that the entire contract will be quashed on the basis of fraud.
Malami made this known in a statement issued by the Special Assistant Media and Public Relation of the office, Dr. Umar Jibrilu Gwandu, and made available to newsmen in Abuja on Friday, November 29.
The Minister reiterated commitment to vigorously pursue the case aiming at setting aside the award of $9.6b and get the entire contract quashed.
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