Nigeria on Thursday, September 17, won an arbitration case against Sunrise Power over its $2.35 billion claim relating to the hydropower project in Taraba state, after an International Chamber of Commerce (ICC) tribunal in Paris ruled in the country’s favour.
The tribunal also ordered Sunrise Power and its promoter, Leno Adesanya, to reimburse Nigeria 75 per cent of the legal fees and expenses incurred in the arbitration.
According to the decision signed by the three-member panel, the tribunal dismissed Sunrise’s claim that Nigeria breached its contractual obligations under a settlement agreement and an addendum.
It also rejected the company’s request for an order directing Nigeria to pay $400 million, comprising a $200 million settlement sum and another $200 million default sum.
The tribunal further declared that Adesanya was bound by the arbitration agreement with Nigeria under the settlement agreement and addendum.
It also held that it had jurisdiction over Nigeria’s counterclaim against Adesanya and his firm.
Sunrise Power and Adesanya were ordered to reimburse Nigeria 75 per cent of the legal fees and expenses incurred in the arbitration.
The legal fees were put at $11,819,506.51, with $2.5 million to be covered directly from funds held in escrow by the ICC.
The remaining $9,319,506.51 is to be paid by Sunrise and Adesanya, with interest at 10 per cent per annum, compounded annually, from the date of notification of the final award until full payment.
The arbitration costs were fixed at $1,656,500 and are to be borne 75 per cent by Sunrise and Adesanya and 25 per cent by Nigeria.
The panel was presided over by Melaine van Leeuwen, with Stavros Brekoulakis and Simon Nesbitt serving as co-arbitrators.
Nigeria was represented by a legal team led by Elizabeth Oger-Gross and Tolu Obamuroh, now of Paul Hastings LLP.
Sunrise Power commenced arbitration against Nigeria at the ICC International Court of Arbitration on October 10, 2017, seeking about $2.354 billion over an alleged breach of contract relating to a 2003 agreement for the construction of the 3,050MW Mambilla hydropower plant in Taraba state.
The project was to be developed on a build, operate and transfer basis and was valued at about $6 billion.
In a second arbitration, Sunrise sought an additional $400 million under the terms of a settlement agreement reached with the Nigerian government in 2020 to end the earlier dispute.
The latest ruling addressed the claims arising from the settlement agreement and its addendum.
The dispute over the original Mambilla contract has previously drawn comments from former president Olusegun Obasanjo.
In a 2023 interview, Obasanjo said he had not authorised former minister of power Olu Agunloye to award the $6 billion Mambilla contract to Sunrise Power.
Obasanjo said no minister had the authority at the time to commit the government to such a project without presidential approval and maintained that he did not approve the deal.
Former president Muhammadu Buhari also denied authorising the 2020 settlement agreement between Nigeria and Sunrise Power.
In a letter to attorney-general of the federation Lateef Fagbemi, Buhari said he had refused to approve the proposed settlement when it was presented to him in April 2020.
He maintained that he saw no basis for Sunrise’s claim.
The latest tribunal decision dismisses Sunrise Power’s $2.35 billion claim and requires the company and Adesanya to bear most of Nigeria’s legal costs in the arbitration.
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