By Zuleihat Owuiye, Nigeria

The Federal Government has secured a major victory in its long-running legal dispute with Sunrise Power and Transmission Company Limited over the delayed Mambilla Hydroelectric Power Project in Taraba State.

An International Arbitration Tribunal operating under the International Chamber of Commerce (ICC) in Paris ruled in favour of Nigeria, rejecting claims that could have exposed the country to liabilities exceeding $3.38 billion.

President Bola Tinubu confirmed the development in a statement issued by the State House on Thursday, describing the arbitration decision as a victory for Nigeria.

The dispute dates back to October 10, 2017, when Sunrise Power initiated arbitration proceedings against the Nigerian government at the ICC International Court of Arbitration.

The company alleged that Nigeria had breached a 2003 agreement connected to the development of the Mambilla power project.

According to the Presidency, Sunrise sought $680 million as a settlement, including interest, in the latest arbitration proceedings. The company is also pursuing a separate claim of more than $2.7 billion in compensation and interest over disputes relating to the development of the Mambilla project.

The latest ruling therefore represents a significant reduction in the financial risk Nigeria faced from the long-running dispute.

The Mambilla project, located in Taraba State, was initially conceived as a 3,050-megawatt hydroelectric power plant. However, the planned capacity was later reduced by about half to 1,525MW and subsequently rescaled to approximately 1,500MW.

The government said the adjustments were aimed at making the project financially viable and bankable enough to attract lenders.

Despite its potential to significantly increase Nigeria’s electricity generation capacity, the project has faced years of delays, including disputes and legal challenges surrounding its development.

The arbitration victory could now provide fresh momentum for efforts to move the 1,500MW project forward.

The Federal Government’s successful defence also means Nigeria has avoided the substantial financial exposure associated with Sunrise Power’s claims, while the government can continue its efforts to resolve the issues surrounding the long-delayed Mambilla project.