Former President Muhammadu Buhari has denied authorising any settlement agreement with Sunrise Power and Transmission Company Limited on the Mambilla hydroelectric power project.
Former president Olusegun Obasanjo previously denied authorising Olu Agunloye, former minister of power and steel, to commit Nigeria to the $6 billion “build, operate and transfer” contract with Sunrise Power in 2003.
Sunrise Power had, on October 10, 2017, started arbitration against Nigeria at the ICC International Court of Arbitration, Paris, France, seeking a $2.354 billion award for “breach of contract” to a 2003 agreement to construct the 3,050MW plant in Mambilla, Taraba state, on a “build, operate and transfer” basis.
In its defence at the arbitration, the Nigerian government is alleging fraud and corruption of public officials in the award of the contract.
To resolve the issue, Abubakar Malami, then attorney-general of the federation (AGF), had committed the federal government to pay Sunrise Power $200 million “within 14 days” of the execution of the terms of the agreement on January 21, 2020, and also pay a penalty of 10 percent in case of a default in fulfilling the settlement agreement — in addition to restoring Sunrise as the local content partner for the project.
However, reports Buhari refused to approve the payment of the $200 million to Sunrise Power.
“FG does not have USD 200 million to pay SPTCL,” the former president said in his reply to Malami.
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Malami tried to re-negotiate the terms thereafter, blaming Nigeria’s inability to honour the agreement on the global pandemic and related economic challenges.
It was reported that Sunrise Power later agreed to discontinue the arbitral proceedings after an out-of-court settlement was reached with the federal government.
However, the arbitration was not terminated.
BUHARI’S LETTER TO FAGBEMI
“The Mambilla project was one of the key projects that I wanted to complete under my administration, but the project was bedeviled by a myriad of issues, mostly inherited,” Buhari wrote.
“While I understood that my ministers of justice, power and water resources were approached by Sunrise and were engaging with various stakeholders that were involved in the project to resolve the issues blocking the project’s implementation, at no time did I specifically instruct them to enter into and conclude any settlement agreement with Sunrise Power and Transmission Company Limited.
“Indeed, when the proposed settlement agreement and addendum were presented to me for my consideration and approval on 20th April 2020, I refused to approve the settlement deal because I was convinced that there was no basis for Sunrise’s claim.”
