International Organisations caution FG against scaring credible investors away over Mambilla

**Ask FG to settle with Sunrise Mambilla hydro

A protracted legal tussle between the Federal Government and Sunrise Power and Transmission Ltd, the company which won the contract to deliver the project, has stalled the actualisation of 3050MW hydroelectric power project conceived more than four decades ago to provide the critical power to drive the economy.
Nigeria continues to grope in darkness, while the project is lying waste

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, the Federal Government 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.

Sunrise in September 2021 withdrew the $500m settlement arbitration on condition that the Federal Government makes a financial commitment towards the project, and respects its right as the exclusive local content partner, but the Federal Government failed again to make any payments to the EPC contractors and/or the counterpart funds to China Eximbank.

In a dramatic twist, the Federal Government demanded a $1.6 million in legal fees from Sunrise for withdrawing the suit at the ICC. On October 13, 2022, ICC ruled against all objections raised by the Federal Government. 

FG alleges fraud, goes after Ex-minister, Sunrise
While the matter is still pending before the ICC, the Federal Government through the Economic and Financial Crimes Commission, EFCC, last year levelled 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 writes Tinubu
Last month, the EFCC also declared Adesanya wanted in connection with the fraud allegation. But in an open letter to President Bola Tinubu, Adesanya insisted that he is not a fugitive and had done nothing wrong in the Mambilla Power project.
Adesanya stated that it is regrettable that the commission would declare him wanted without formally drawing his attention to any charge against him. He also stated that it is laughable that the EFCC would accuse him of bribing Agunloye 21 years after he left office with N3.6million through payment of his medical bill and travel expenses.

He insisted that due process was followed in the award of Mambilla Hydro-Power Project and that his company has no regrets assisting Agunloye when the need arose.

“This criminalisation strategy of the Federal Government using institutions including the EFCC, is manifest in its effort in alleging that I facilitated the payments of N3.5 million, N500, 000 and N1.12 million (a total of N5.22 million) to Dr Agunloye, in 2019 for his medical treatment in Florida, is laughable, because Dr Agunloye left the government 21 years ago, and ceased to be a public officer in 2001.

“It is pertinent to state that there is no alignment between my kindness of 2019 and the BOT contract of 2003. Who waits for bribes to be paid 16 years after a contract has been awarded? Which stupid Minister will collect N12 million bribe for a $6 billion (today’s rate N11 trillion) BOT contract; definitely not a Nigerian security guard, let alone a Minister. 

“In the absence of any credible defence to Sunrise’s claims, the Federal Government through the EFCC has continued to desperately hunt down potential witnesses and to scandalize the underlying contract. In support of this objective, the EFCC has now secretly filed a charge against SPTC (in Charge No: FCT/HC/CR/618/2023 between Federal Republic of Nigeria v. Sunrise) pending in a court located in the remote village of Jikowi, on the outskirts of the Federal Capital Territory and bounded by Nasarawa State.  

“Stunned by its manifest lack of any defence or justification for the unilateral cancellation and breach of its binding contractual obligations to Sunrise, and the likelihood of being found liable for breach of contract, the FGN through its various security agencies has now resorted to attempting to criminalize and scandalize the Mambilla Power Project with the sole aim of evading the consequent legal contractual obligations of the Federal Government arising from breaches of agreements with Sunrise.”

Olive branch offered
Mr Adesanya in his letter to President Tinubu also offered an olive branch to the Federal Government for an amicable settlement of 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.” International Community the United Nations, (UN) Transparency International, (TI) and the International Court of commerce (ICC), have cast the beam light on the Mambila Hydropower dispute and its proceedings home and abroad.

They have warned against human rights violation, insisting on strict adherence to the rule of law. An international observer, who craved anonymity, noted that President Bola Tinubu is now highly respected and admired by the Brenton woods institutions, and the international community due to his adherence to robust and pragmatic policy reforms even at the risk of high criticisms from the citizenry.

She expressed confidence in the office of President Tinubu to ensure fairness and a level playing ground or even settle the Mambilla hydropower dispute amicably.

President Tinubu recently resolved a long drawn legal battle over OML 245 Malibu oil deal. Onlookers and stakeholders expect President Tinubu would do same on the Mambilla hydro power dispute. When completed, the Mambilla hydropower project is expected to generate 3,500 mgws of electricity, create 50,000 skilled jobs, short and long term economic spillovers for the North-east geopolitical zone and Nigeria as a whole.