Fresh trouble is brewing for Nigeria as Donnington Nigeria Ltd and its foreign partners have
given notice to the Federal Government of their intention to drag the country into
international arbitration over the ACD/CTN scheme, a move that would further tarnish
Nigeria’s image globally as a country notoriously allergic to contractual obligations, transparency and due process.
This would be a major blow to Nigeria, seeking to draw international investment into numerous projects , and it comes as the Federal Government is still smarting from an international embarrassment
following a legal debacle that led to a Chinese firm seizing properties belonging to the
Federal Republic of Nigeria abroad in pursuit of a court judgement, including presidential jets
and real estate properties in Liverpool, United Kingdom.
Now, Gary Summers of Gray’s Inn, London-based solicitor to Donnington Nigeria Limited
(DNL), Donnington International AG, Vortexra UK, and DP World UAE, has written to the
Attorney-General and Minister of Justice, Chief Lateef Fagbemi (SAN) over “the recent
publicized appointment of a new consultant by the Federal Government of Nigeria (FGN) for
the Cargo and Crude Oil Tracking and Notification (ACD/CTN) scheme, which we believe
disregards ongoing legal proceedings and raises serious issues of transparency and due
process.”
It was gathered that the purported award was made while Donnington and the Federal Government
are in court over the same matter. Donnington and its international partner and specialists
says it has suffered substantial financial harm after self-serving top officials in the former
President Muhammadu Buhari administration used proxies to divert the CTN scheme to
themselves – despite a presidential executive order that had snapped on a greenlight to
Donnington Ltd who reportedly went through a stringent procurement process in accordance with the
Public Procurement Act 2007 with numerous government ministries and was successfully
endorsed by the Ministries, the Customs service and the Minister of Justice, to implement the
scheme that would have generated billions of Naira for Nigeria.
This alleged abuse of office and breach of fiduciary position left the country bleeding because,
according to a Daily Trust report of October 31, 2022, over $4.9Billion had been lost
annually due to the inability of the scheme to be implemented as planned – because of the
legal battle the CTN contract had elicited.
Recall that Donnington Nigeria Ltd was earlier cleared by the Buhari administration for the
CTN Contract before it was said to be shortchanged by government functionaries, who ultimately
allegedly awarded the lucrative contract to themselves, using bubble companies and partners
which in certain cases had previously been charged by the FGN with fraudulent undertakings
and actions.
In suits FHC/ABJ/CS/1483/2022 and FHC/ABJ/CS/2351/2022 against the Federal
Government of Nigeria and others, Donnington Ltd is seeking declaratory reliefs and an order
of injunction to halt the unlawful re-award of the ACD/CTN Scheme. In pursuance of the
successful procurement process and appointment, it had committed both financial and human
resources to the realization of the CTN scheme.
According to the Donnington solicitor with a “historical unfinished procurement process”
awarding the ACD/CTN scheme to a new consultant, P-LYNE Nigeria Limited, despite
subsisting court orders and cases, apart from not being standard practice is also null and void,
and against the rule of law.#
Donnington said the appointment of P-LYNE as the new consultant, raises “concerns about
conflicts of interest, the lack of due diligence, due process, transparency, and the
appointments not being in the best interests of the people of Nigeria” and “we question the
legality and validity of the appointment of P-LYNE Nigeria Ltd..
The company said in the letter to the AGF, “It has come to our attention that despite the
ongoing high court case involving Donnington Nigeria Limited (DNL), the Petroleum
Upstream department within the Federal Ministry of Petroleum Resources (FMoPR) has
moved forward with approval for the FGN appointing P-LYNE Nigeria Ltd, a subsidiary of
the Sahara Energy Group, as the consultant for the ACD/CTN scheme, in total disregard for
the court order of the ongoing cases at the High Court referenced earlier in this document.”
Donnington further stated, “This decision, made in the absence of thorough due diligence and
amidst legal actions, not only undermines the judicial process but also poses a significant
risk to the integrity of the ACD/CTN scheme itself.” And “It is extremely concerning that this
appointment was made in such a hurried way, disregarding the ongoing procurement
procedure and the legal issues raised by Donnington Nigeria Limited and being heard within
the High Court of Nigeria.”
It added that “the award of the ACD/CTN contract to P-LYNE Nigeria Ltd, a company with
clear ties to Sahara Energy Group—a major player in crude oil trading—raises significant
concerns about conflicts of interest.”
It is like a case of putting a goat in charge of a warehouse full of yams. Because according to
Donnington, “a company involved in crude oil trading nationally and internationally, should
not be entrusted with the responsibility of tracking crude oil, as this could compromise the
objectivity and effectiveness of the ACD/CTN scheme.”
Donnington was concerned by the “speed and lack of transparency in the processes that led
to the recent announcement of the appointment of P-LYNE Nig Ltd and P-Lyne Energy Ltd to
execute a part of an already awarded contract which is being contested in the High Courts of
Nigeria,” believing the appointment is questionable, and has no basis in law.
Donnington’s legal team also critically pointed out that the Presidential Executive Directive
issued on the 4th May 2021, which the then Chief of Staff to the President, Prof Ibrahim
Gambari, in his letter of 16th August, inappropriately and illegally cancelled, was the same
order/approval the Ministry of Petroleum Recourses/Upstream Department relied upon to
award the Crude Oil Tracking contract to P-LYNE – despite being aware of the ongoing
litigation at the Federal High Court to which they are a party to. Notwithstanding the fact that
the court had ordered the parties to maintain the status quo pending the determination of the
case.
But more worrisome to the company was the fact that the government awarded a payment of
USD$21million (which is understood to be a mobilization fee) to P-LYNE “when
Donnington’s arrangement with the FGN and approved by the Ministry of Finance was at no
cost to the federal government”. And “It was expected that Donnington Nigeria Limited
would implement the International Cargo Tracking Scheme (ICTN), including crude oil
exports in Nigeria for the contracted period on a “No cure, No Pay Basis”, with an agreed
revenue sharing ratio accruable to the Federal Government of Nigeria.”
The company advised the AGF in the letter that the $21 million being paid to the P-LYNE
Nigeria Ltd when they are on a revenue sharing ratio, “is not in the favour of the Nigerian
people.”
Mr Summers warned that “Donnington Nigeria Limited are in the final process of filing the
Request for Arbitration proceedings against the Federal Republic of Nigeria (FRN) in
accordance with The Convention on the Settlement of Investment Disputes Between States
and Nationals of Other States (“ICSID Convention”) and Rules of Procedure for the
Institution of Conciliation and Arbitration Proceedings (“ICSID Institution Rules”).
“The claims relate to breaches of the bilateral investment treaties (“BITS”), with its investors
and partner, under the jurisdictions of the United Kingdom and Switzerland, to which the
FRN is a party.”
He also informed Chief Fagbemi that Donnington Nigeria Limited and its technical partners
have appointed a highly reputed international specialist investigatory team which continue a
review into the FGN contract award of the cargo and crude oil tracking note scheme.
“The investigatory team is being led by Tarique Ghaffur, a former Assistant Commissioner of
London’s Metropolitan Police, head of Scotland Yard’s Specialist Crime Directorate, and as
the head of an international security consultancy, together with his team of public corruption
and economic crime experts, which includes investigatory support by Kroll Inc. based in the
United Kingdom, Summer noted “the intent is to further widen the pre-investigation to cover
the new appointment of P-LYNE Nigeria Ltd..”
The solicitor further stated that his clients Donnington and partners now intend to attach to
the arbitration filing further cause for dispute, “concerning the FGN process of appointing an
additional consultant to the ACD/CTN scheme, P-LYNE Nig Ltd, whilst cases relating to the
appointment of consultants are still to be heard within the High Courts of Nigeria.”
He urged the AGF to intervene in the matter and promptly act so as to safeguard “the integrity
of the ACD/CTN scheme and protect the interests of the Nigerian people.”
As of the time of filing this report, the AGF office had not responded to our request to
comment on the matter.
It has been reported that Donnington has enlisted the services of a UK forensic accountant to
assess the financial losses incurred due to the termination of their role as technical consultants
for the CTN scheme during the previous administration. The projected losses are significant,
and Nigeria is at risk of experiencing severe financial consequences unless the AGF promptly
takes action to restore Donnington to its previous state and prevent the imminent international
arbitration. This will only worsen the country’s reputation among the much-needed investors,
hindering its recovery from the economic crisis.
BACKGROUND:
Donnington Nigeria Ltd had sued the Federal Republic of Nigeria, the Attorney-General of
the Federation and eight others, seeking to set aside the purported award of contract for the
Implementation of Advanced International Cargo Tracking Note (ICTN) Management in
Nigeria.
The Federal Government of Nigeria, it said had unlawfully awarded the contract to Antaser
Belgium, Velocity Logistics and Marine Ltd, Saham Crystal Investment Ltd, Winslow
Logistics Ltd and Equal Logistics Ltd, who are listed as 6th, 7th, 8th, 9th and 10th defendants
in the suit
The plaintiff, which initially went through a successful procurement process and appointment
approval for the said contract, alleged that the contract was later taken from them in violation
of Nigerian laws and wrongfully awarded to the 6th to 10th Defendants, without due process.
They also alleged that the beneficial owners of the companies that got the award were top
government officials, who abused their offices to corner the juicy contract, using the
companies as proxies.
With a new government in power, and new top government officials appointed, it appears
they have also moved to hijack the pivotal and critical CTN contract for their proxies, just
like those under the Buhari government were accused of doing. Which explains why the scheme envisaged
since 2011 had yet to take off – due to the illegal greed of government functionaries to the
detriment of the Nigerian State and its people.
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