Nigeria has secured a major victory in its long-running arbitration dispute with Sunrise Power and Transmission Company Limited over the Mambilla Hydropower Project, with an International Chamber of Commerce (ICC) tribunal dismissing the company’s $2.35 billion claim against the country.
The tribunal, sitting in Paris, France, also ordered Sunrise Power and its promoter, Leno Adesanya, to reimburse Nigeria 75 percent of the legal fees and expenses incurred in the arbitration, amounting to $11.82 million.
The award, issued on Thursday, further rejected Sunrise’s claim that Nigeria breached its contractual obligations under the disputed settlement agreement and its addendum, according to the decision.
The tribunal also dismissed the company’s demand for $400 million, comprising a $200 million settlement sum and an additional $200 million default sum.
In another significant finding, the three-member panel declared that Adesanya was bound by the arbitration agreement with Nigeria under the settlement agreement and addendum, and that it had jurisdiction over Nigeria’s counterclaim against him and his firm.
Sunrise and Adesanya were ordered to reimburse Nigeria $11,819,506.51 in legal fees and expenses. Of the amount, $2.5 million is to be released directly from funds held in escrow by the ICC upon notification of the final award.
The tribunal ordered the respondents to pay the remaining $9,319,506.51, with interest accruing at 10 percent annually, “compounded annually, from the date of the notification of this Final Award until such amount is paid in full”.
The arbitration costs, fixed at $1,656,500, were also apportioned, with Sunrise and Adesanya directed to bear 75 percent while Nigeria would cover the remaining 25 percent.
The tribunal was chaired 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 of Paul Hastings LLP.
How the Mambilla Dispute Started
The dispute dates back to a 2003 agreement concerning the proposed 3,050-megawatt Mambilla hydropower project in Taraba State, which was originally structured on a build, operate and transfer basis.
Sunrise commenced arbitration proceedings against Nigeria at the ICC International Court of Arbitration in Paris on October 10, 2017, seeking approximately $2.354 billion over what it described as a breach of contract.
The company subsequently pursued a separate claim arising from a 2020 settlement agreement, demanding $400 million after alleging that Nigeria failed to honour the terms of the agreement.
The Mambilla dispute has generated controversy across successive administrations, with former President Olusegun Obasanjo and former President Muhammadu Buhari both publicly questioning aspects of the contractual and settlement arrangements.
In a 2023 interview with TheCable, Obasanjo challenged his former Minister of Power, Olu Agunloye, to explain the authority under which the 2003 agreement with Sunrise was entered into.
“When I was president, no minister had the power to approve more than N25 million without express presidential consent. It was impossible for Agunloye to commit my government to a $6 billion project without my permission and I did not give him any permission,” Obasanjo told TheCable.
“If a commission of inquiry is set up today to investigate the matter, I am ready to testify. I do not even need to testify because all the records are there. I never approved it.”
The former president further said he had opposed the proposal when Agunloye presented it to the Federal Executive Council in May 2003.
“When he presented his memo to the federal executive council (on May 21, 2003), I was surprised because he had previously discussed it with me and I had told him to jettison the idea, that I had other ideas on how the power sector would be restructured and funded.
“I told him as much at the council meeting and directed him to step down the memo. I find it surprising that Agunloye is now claiming he acted on behalf of Nigeria. If I knew he issued such a letter to Sunrise, I would have sacked him as minister during my second term. He would not have spent a day longer in office.”
Agunloye has previously rejected the allegations, maintaining his position on the Mambilla contract.
The controversy later extended to the settlement agreement reached in 2020.
Former President Buhari, in a letter to current Attorney-General of the Federation, Lateef Fagbemi, denied authorising the settlement agreement with Sunrise.
“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,” he wrote.
“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.”
Buhari added that he hoped his clarification would assist the Federal Government’s legal defence against what he described as “invisible contractors who all too often quietly take Nigeria for many millions in out-of-court settlements”.
The Mambilla project has consequently remained entangled in legal and contractual disputes for years, despite its proposed capacity of 3,050 megawatts. Earlier industry and legal records have documented the separate arbitration proceedings involving Sunrise and Nigeria, including the original multibillion-dollar claim and subsequent dispute over the proposed settlement.
The latest tribunal decision represents a significant development in the long-running dispute, with the panel not only rejecting Sunrise’s principal claims but also imposing substantial costs on the company and Adesanya.
