Aare Afe Babalola has led a team of legal representatives to secure conviction for the Federal Republic of Nigeria in a matter filed against the country by two United States registered companies, Interocean Oil Development Company and Interocean Oil Exploration Company before the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) tribunal headed by Professor William W. Park, by two United States registered companies, Interocean Oil Development Company and Interocean Oil Exploration Company.
The International Centre for Settlement of Investment Disputes dismissed the arbitration commenced by the two foreign companies which were incorporated under the laws of Delaware, USA against the Federal Republic of Nigeria.
ICSID also awarded the cost of USD$660,129.8 against the two companies in favour of Nigeria which instituted an arbitration proceeding against the Federal Government of Nigeria before the ICSID Tribunal sitting in Washington DC, USA.
The Federal Government’s team that secured the victory was led by Aare Afe Babalola, with support from Mr. Adebayo Adenipekun (SAN), Mr. Olu Daramola (SAN), Mr. Kehinde Ogunwumiju (SAN), Ms. Ann Babalola, Mr. Oluwasina Ogungbade and Mr. Ola Faro.
The Federal Government representatives at the trial were Mr. Taiwo Abidogun, the former Solicitor General and Permanent Secretary, Ministry of Justice, Mr. Dayo Apata, the current Solicitor General and Permanent Secretary, Ministry of Justice.
The two companies filed claims bordering largely on the loss of the 40 per cent participating interest in the Nigerian Oil Mining Lease 98 (“OML 98”) and Oil Prospecting License 275 (“OPL 275”) which were both created pursuant to a joint venture agreement between the Nigerian National Petroleum Corporation (NNPC) and Pan Ocean Oil Company, the Claimant’s holding company in Nigeria.
The case which lasted for a period of seven years was premised on the ownership and control of Pan Ocean Oil Corporation, the beneficial owner of both OML 98 and OPL 275.
The claim relates to the ownership and control of a limited liability company named Pan Ocean Oil Corporation which was the beneficial owner of participating interests in OML 98 and OPL 275. The Claimants and their owners who are foreign nationals had initiated several litigations against the Nigerian directors of Pan Ocean at the Federal High Court and Court of Appeal in Nigeria alleging that they were the legitimate owners of Pan Ocean.
But when the foreign companies lost all the cases they filed at the Nigerian Courts, they changed the nature of their petition and initiated arbitration before the ICSID Tribunal alleging that the Federal Government of Nigeria colluded with the Nigerian directors of Pan Ocean to deprive them of their interests in Pan Ocean.
The companies sought for a declaration of the tribunal that the Federal Republic of Nigeria had breached its obligations to them under the Nigerian law and international laws. They had also prayed for an award directing Nigeria to restore only their nominees as representatives in the 40 per cent participating interest under the operation of all Joint Venture Agreements and OML 98 and OPL 275.
They further asked the tribunal to award the sum of US$ 2 Billion against Nigeria for alleged breaches of Nigerian and International laws,
The Claimants had in its arbitration team Mr. Olasupo Shasore (SAN), Professor Oba Nsugbe QC (SAN), Mrs. Bimpe Nkontchou, Mr. Bello Salihu and Ms. Fadesike Salu while Mr. Patrizio Di Guevara Fabri and Mr. Riccardo Di Guevara Fabri were the representatives for the companies.
In its final award, the tribunal found that the Federal Republic of Nigeria did not breach any of its obligations to the companies under Nigerian and International law.
The ICSID tribunal consisting of Professor William Park, Professor Julian Lew and Hon. Justice Edward Torgbor dismissed indirect expropriation claims brought by the companies and ordered them to pay USD 660, 129.87 to the Federal Government as arbitration costs incurred in the proceedings.
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