Court Sets Aside Judgment On Breach Of Contract Between Shell And Global Gas Refining Ltd For Supply Of Gas

The High Court of Lagos has set aside the judgment of the Arbitral Tribunal, which dismissed Global Gas and Refining Limited’s claim of a breach of contract for the supply of gas by the Shell Petroleum Development Co of Nigeria, also known as SHELL.

In the ruling delivered on Tuesday, the 25th day of February, 2020, in Suit No: LD/1910GCM/2017 between Global Gas and Refining Ltd v. Shell Petroleum Development Co of Nigeria Ltd, the High Court of Lagos, Nigeria, set aside the ICC judgment in which the members of the Arbitral Tribunal including Prof. Oba Nsugbe, QC,SAN & Mrs Doyin Rhodes-Vivour, SAN; with Mrs Dorothy Udeme Ufot, SAN dissented and delivered dismissed the claimant’s prayer.

In the court’s ruling, the learned judge underscored the fundamental importance of full and complete disclosure in international commercial arbitration and inter alia upheld the argument of Global Gas that the failure and neglect of the President of the Arbitral Tribunal (Prof. Oba Nsugbe, QC, SAN) to disclose his earlier involvement in a matter in which the Respondent in the Arbitration (SPDC) was involved amounted to gross misconduct for which the Award delivered by the Majority of the Arbitral Tribunal ought to and must be set aside.

Global Gas Refining Limited (GGRL) is an independent indigenous gas processing operator and Liquefied Prtroleum Gas (LPG) producer, operating in the Niger Delta Region of Nigeria.

It is on record that the company, founded by Kenneth Yellowe is the first indigenous private company in Nigeria and West Africa to successfully embark on a multi-million dollar gas processing and refining facility in the country, with operations and assets situated in the Niger Delta creeks at Cawthorne Channel, Rivers State.

This facility with such a tremendous capacity to advance the regional and national economic growth of the nation, was put in jeopardy by the Shell Petroleum Development Company of Nigeria (SPDC)’s inability to honour their side of a binding Gas Supply Agreement executed in March 1998 and renegotiated and resigned in March 2002.

Consequently, a large workforce comprising hundreds of teeming Nigerian youths, were laid off, while experts of different nationalities, several dozens of local contractors, as well as the thriving host communities have all now been made redundant.

Over $400m, secured from international financial institutions and individual investors, are now also in jeopardy because of economically hurtful decisions being made by the Shell Petroleum Development Company of Nigeria (SPDC).