Procedural Posture

This document constitutes the Dissenting Final Award issued by Arbitrator Bayo Ojo in the arbitration proceedings between Process and Industrial Developments Limited (Claimant) and the Ministry of Petroleum Resources of the Federal Republic of Nigeria (Respondent). While adopting the majority tribunal’s findings on jurisdiction, procedural history, and liability, the dissenting arbitrator fundamentally diverged from the majority regarding the quantum of damages, specifically concerning the duty to mitigate, Capital Expenditure (CAPEX), Operating Expenditure (OPEX), and projected plant yield.

Duty to Mitigate and Compensable Period

The principal legal divergence centered on the Claimant’s duty to mitigate its losses under Nigerian and English law. The dissenting arbitrator rejected the majority’s conclusion that the Claimant was entitled to twenty years of lost profits amounting to $8.6 billion. Relying on established Nigerian jurisprudence, the dissent emphasized that the burden of proving the discharge of the duty to mitigate rests on the party claiming damages. Because the Claimant admitted to putting other projects on hold to undertake the disputed Gas Supply and Processing Agreement (GSPA), the dissent reasoned that the Claimant possessed the capacity to pursue alternative investments following the breach. Consequently, the dissenting arbitrator concluded that awarding twenty years of unmitigated lost profits would constitute an unjustifiable windfall, limiting the compensable period to three years (2015–2018).

CAPEX, OPEX, and Plant Yield Analysis

Regarding the financial modeling of the hypothetical gas processing plant, the dissent found the Claimant’s CAPEX and OPEX estimates to be overly conservative and detached from the local realities of operating in the Niger Delta. The dissenting arbitrator credited the Respondent’s expert testimony, which demonstrated that the Claimant’s CAPEX was understated by approximately 40% and OPEX by 25%, largely due to the failure to account for necessary security personnel and community engagement costs. Furthermore, the dissent rejected the Claimant’s assumption of 90% plant uptime. Acknowledging the pervasive security challenges and force majeure risks inherent in the Niger Delta region, the dissent adopted the Respondent’s projection, capping the reasonable expectation of plant uptime at 60%.

Dispositive Findings

In stark contrast to the majority’s multi-billion-dollar damages award, the dissenting arbitrator concluded that the Respondent should pay the Claimant a significantly reduced sum of $250 million in damages for breach of contract. The dissent further directed that this amount be paid within ninety days of the award and ordered that each party bear its own legal costs, with the costs of the arbitration reference to be shared equally.