Mambilla: How legal tussle keeps Nigeria in darkness

No access road to Mambilla Hydroelectric Power site, says Gov Ishaku

…As senior lawyers seek amicable resolution

By Henry Ojelu

While Nigeria continues to grope in darkness, a 3050mw hydroelectric power project conceived more than four decades ago to provide the critical power to drive the economy, is lying waste due to a protracted legal tussle between the Federal Government and Sunrise Power and Transmission Ltd, the company which won the contract to deliver the project.

Located in Mambilla, Taraba State, the hydro-electric project when completed, is expected to add about 4.7 billion kWh of electricity a year to the national grid making it the biggest power project in the country.

Like many other legacy projects of successive governments which have failed to see the light of day, Mambilla Hydroelectric Power project has remained a baby unable to crawl 40 years after.

Award of contract to Sunrise

Determined to activate the Mambilla project, after an international bid process, the Federal Government in 2003, awarded a $6 billion Build, Operate and Transfer, BOT contract to Sunrise and its Chinese consortium partners. Poised to deliver the project, Sunrise consortium secured a $5.5 billion in Chinese Eximbank loans in 2005. Surprisingly in 2007, the Federal Government revoked the contract and signed a $1.46b civil works contract with a Chinese firm, Messrs China Gezhouba Group Corporation/China Geo-Engineering Corporation (CGGC/CGC) in clear violation of Sunrise’s BOT contract.

Sunrise launched series of judicial counters to the termination of the contract on May 28, 2007, culminating in a 14-year delay, with the new awardee effectively barred from commencing the execution of the contract. In November 2007, Sunrise filed a petition to then President Umaru Yar’Adua, and the $1.46b EPC contract was terminated in 2009.

On November 23, 2012, FG signed a General Project Execution Agreement, GOEA with Sunrise and its Chinese consortium partners for the execution of the Mambilla project. However, on November 12, 2017, the FG signed a $5.8 billion EPC contract with another Chinese Consortium despite numerous written warnings from the  then Attorney-General of the Federation to the Federal Ministry of Power, Works and Housing in 2016 and 2017 to respect the GPEA contract with Sunrise.

Sunrise seeks  ICC intervention

Sunrise resorted to arbitration at International Court of Arbitration administered by the International Chamber of Commerce, ICC, against the Federal Government and Sinohydro Consortium of China in 2018, claiming $2.3 billion in damages.

With the intervention of the Chinese President, who sent a special envoy to then President Muhammadu Buhari in July 2019, FG and Sunrise signed a settlement agreement in January 2020; and the settlement was advised to both the Chinese Ambassador to Nigeria and Chairman of China Eximbank, who had made the settlement condition precedent to any loans for the project. However, the FG defaulted.

In good faith, Sunrise in September 2021 withdrew the $500m settlement arbitration on condition that the FG Gmakes a financial commitment towards the project, and respects its right as the exclusive local content partner, but the FG failed again to make any payments to the EPC contractors and/or the counterpart funds to China Eximbank. On October 13, 2022, ICC  again ruled against all objections raised by the Federal Government in the matter.

While the matter is still pending before the ICC, the FG  through the Economic and Financial Crimes Commission, EFCC, last year leveled allegations of fraud in the Mambilla Power project against former Minister of Power and Steel, Mr Olu Agunloye and Sunrise. Specifically, the EFCC alleged that Agunloye on May 22, 2003, awarded a contract, titled: Construction of 3,960mw Mambilla Hydroelectric Power Station on a Build, Operate and Transfer Basis to Sunrise without any budgetary provision, approval and cash backing. Agunloye was also alleged to have on August 10, 2019 corruptly received N3.6m from Sunrise and its Chairman, Leno Adesanya as kickback for the contract.

Adesanya sues EFCC

Last month, the EFCC also declared Adesanya wanted in connection with the fraud allegation. Irked by the action of EFCC in declaring him wanted, Adesanya on February 29, 2024 filed a exparte motion before the Federal High in Abuja seeking a restraining injunction against the anti-corruption agency. Joined in the suit as co-defendants are the Federal Minister of Power and Steel, Federal Government of Nigeria and the Attorney General of the Federation.

Court restrains Commission

Ruling on the application yesterday, Justice I.E. Ekwo granted the prays of Mr Adesanya and restrain the EFCC from arresting him.

The court held:”An order is hereby made directing the 1st respondent, either by itself, officers, agents, servants, privies or otherwise howsoever described to maintain status quo and or stay further action with respect to the arrest or restriction of the personal liberty or right of movement or residence of the 1st applicant in Nigeria and further publication of the name and photograph or any other form of information concerning or pertaining to the applicants, pending the hearing and determination of the motion on notice before this court.”The matter was adjourned to March 21, for hearing.

Olive branch offered

Despite the legal battle with the FG, Adesanya insist that he ready for amicable settlement in the matter

He said:  “As a sign of good faith, if the FGN is fully determined to execute the 3050MW Mambilla hydropower project as approved by then President Yar’Adua, and reconfirmed several times by former President Goodluck Jonathan.

“I am ready to mobilise my Chinese Consortium partners only if His Excellency, Mr. President will personally sign all the financial commitments to the Chinese Eximbank, Corporate and Financial Institutions who had demonstrated their commitments to the project in the past.”

Babalola, Olanipekun, Falana  seek amicable resolution

Writing on behalf of his client, a former President of the Nigerian Bar Association, NBA, Chief Wole Olanipekun, SAN,  renowned lawyer, Chief Afe Babalola, SAN, and human rights lawyer, Mr. Femi Falana, SAN, at different times  asked the Federal Government to seek an amicable settlement and revive the execution of the $5.8 billion Mambilla hydro-electric power project by Sunrise.

The top lawyers, in separate official letters, advised the Federal Government to amicably resolve the dispute, saying that unlike the Process & Industrial Developments, P&ID, case which was flawed with corruption, bribery and preemptive contractual loopholes, the Mambilla/Sunrise case might be different.

In a letter titled: ‘Re: ongoing Arbitration between Sunrise Power and Transmission Company and the Federal Government of Nigeria arising from the Mambilla Hydro Electric Power Project,’, Chief Olanipekun, said the dispute pending before the International Court of Arbitration in Paris, France, can be resolved amicably to save the country unwarranted embarrassment.

With Reference No: WOC/LG/VOL.04/123/2023, and addressed to the Attorney General and Minister of Justice, Lateef Fagbemi, SAN, the letter noted that there are misinformation/misrepresentations that are being bandied, even in some high quarters, about what took place.

Olanipekun stated that it was not fair that the dispute had stagnated the commencement and execution of the Mambilla project for many years. He urged the federal government to seek an amicable settlement of the matter and negotiate with the firm to resolve the protracted litigation and potential national embarrassment.

The letter read: “Given the foregoing facts and circumstances, which have stagnated the commencement and execution of the Mambilla project for many years, we have been authorised by our client to seek an amicable settlement with the federal government to revive the execution of the Mambilla hydropower project.”

Emir of Mambilla intervenes

Adding his voice to call for amicable settlement of the Mambilla Hydro Power project, the Emir of Mambilla, Dr Shehu Baju II, also urged the federal government to explore amicable means to resolve the dispute as he believes it will enable the country to enjoy the immense benefits of the 3,050 MW hydroelectric power-generating project.

In a letter to President Tinubu, Dr Baju, the President of Sardauna Traditional Council, Taraba State, expressed concern over the lingering dispute, which he said was hindering the project. He noted that the project has also stalled the lighting up of the Mambilla Plateau which has tremendous tourism and agricultural potential.

The letter reads: “We call on you Mr. President to cast your lenses on the Mambilla Hydro Project which is capable of generating over 50, 000 skilled jobs with economic/technical spillovers and 3.500 MWS of electricity in the Northeast region and Nigeria as a whole.

“Your Excellency, we also call on your good office to enforce amicable resolution between the contractors and any ongoing dispute which has stalled this project. “We have followed keenly as events unfold and seek your intervention towards an amicable solution to enable the progress and realisation of this viable project.

“We ask Mr. President that you support both the local content and international partners in ensuring a successful start and completion of this viable project aimed towards local, regional and national development.”