An arbitration tribunal under the International Chamber of Commerce in Paris has rejected a $2.35 billion claim against the Nigerian government by Sunrise Power and Transmission Company Limited regarding the protracted Mambilla Hydroelectric Power Project, in a decision made public on Thursday.
The three-member tribunal, led by Melaine van Leeuwen with Stavros Brekoulakis and Simon Nesbitt serving as co-arbitrators, dismissed Sunrise's assertion that Nigeria violated its contractual duties outlined in a 2020 settlement agreement and its addendum, and also denied a separate claim for $400 million, which included a $200 million settlement amount and a $200 million default fee.
The tribunal additionally determined that Sunrise's promoter, Leno Adesanya, is personally obligated under the arbitration agreement and ordered both Sunrise and Adesanya to pay back 75 percent of Nigeria's legal costs and expenses, totaling $11.8 million, along with 10 percent annual compounded interest, and 75 percent of the arbitration costs amounting to $1.66 million.
The conflict traces back to a 2003 agreement in which Sunrise was contracted to develop a 3,050-megawatt hydropower plant in Taraba State on a build-operate-transfer basis, estimated at around $6 billion; however, the Federal Executive Council never approved the original deal.
Sunrise initiated arbitration proceedings against Nigeria in October 2017, claiming approximately $2.354 billion for alleged contract breaches, and a second dispute later arose from the 2020 settlement agreement.
In response to the ruling, President Tinubu stated that it eliminated “the single biggest legal obstacle” that had hindered the now-expanded 3,960-megawatt Mambilla project for over twenty years, expressing gratitude to Nigeria’s legal team, headed by Elizabeth Oger-Gross and Tolu Obamuroh of Paul Hastings LLP, along with former President Olusegun Obasanjo and the late President Muhammadu Buhari for their testimonies in the case.
The decision carries significance beyond the direct claim, alleviating a substantial liability burden that has complicated initiatives to finally progress a project initially envisioned in the early 2000s.
