FG to use N1.1bn to probe $10bn P&ID contract scam, Senate raises concerns over rising judgment debts


The federal government Monday declared planned investigation into contracts allegedly signed by previous administrations with Process and Industrial Development Limited (P&ID).

The contracts put at $10 billion, it said, were in breach of due process and procedure and capable of undermining the nation’s economy.  

Minister of Justice and Attorney General of the Federation Abubakar Malami (SAN) stated this while appearing before the Senate Committee on Judiciary, Human Rights and Legal Matters for 2022 budget defence session.

In January 2017, an independent London tribunal found that Nigeria was liable for $6.6 billion in damages against P&ID after it failed to deliver on terms agreed in a 2010 gas facility contract.

And in a bid to get the ruling enforced three years later, P&ID got another ruling from a United Kingdom (U.K.) court that Nigeria’s state-owned assets could be seized if the country refused to settle its bill which had risen to $9.6 billion because of accrued interest.

Nigeria was however in 2020 granted the right to appeal the judgement but asked to pay $200 million in the meantime.

While responding to questions from members of the committee chaired by Senator Opeyemi Bamidele by (APC Ekiti Central) on the case, Malami said P&ID contract was never   allowed to pass through the office of the Attorney General and that the contract clauses were inimical to Nigeria’s interest. 

According to him, a taskforce already set up for thorough findings on the contracts signed against the interest of the country by previous administrations, would spend N1.1 billion in 2022.

He said: “It is the taskforce that is intended to review the existing problematic contracts that have the capacity to undermine the economy as far as the P&ID is concerned.

“In the office of the Attorney General, there exists two fundamental departments relating to vetting of contracts. Solicitor Department is charged with vetting any governmental contract and they have lived up to expectations over time. 

“But the major problem with P&ID is that contract was never ever allowed to pass through the Office of the Attorney General for vetting. So, on account of that, there are clauses embedded in the contract that are inimical to the interest of the nation.

“Because of the fact

that there is a preliminary conspiracy among the key promoters of the contract, the contract was never allowed to pass through the Federal Executive Council (FEC) for its approval, neither was it allowed to pass through the Federal Ministry of Justice for vetting.

“The existing structures are there, but they can only act in respect of contracts that are referred to the department. 

“For example, as it is now, even though in respect of government contracts, arising from the fact that China is involving certain clauses regarding immunity which some ministries and departments are willing to compromise, they are not allowed to pass.

“We have developed need for other circulars that these are intended clauses that could be tolerated in public interest and the interest of the nation in mind were attached. What I’m saying in essence is that the taskforce is poised at looking at it. 

“In respect of P&ID, there were about nine contracts that were signed at the same time in breach of due processes and procedures.”

Earlier in his remarks, the committee chairman, Senator Bamidele  lamented soaring judgement debts which, according to him, had become national embarrassment, and called for urgent action to arrest the situation. .

Bamidele said: “It is also pertinent to state that the judgement debt profile of the country keeps soaring without corresponding response from government in order to address the situation.

“This development is now viewed as a national embarrassment and necessary action must be taken to ensure that the image of the country is protected.

“In this regard, I implore you prioritise your budget and make a case for legislative intervention where necessary, in order to ensure that this area of concern is critically looked into, with a view to proffering the much needed solution.”

The ministry proposed N11.8 billion for 2022 budget with personnel cost taking  N3.9 billion, overhead cost (exclusive of legal services) – N2.4billion, legal services – N2 billion and capital budget- N3.5 billion.