An arbitral tribunal constituted under the auspices of the International Chamber of Commerce (ICC) in Paris has ruled in favour of Nigeria in the arbitration brought by Sunrise Power and Transmission Company Limited over the long-delayed Mambilla Hydroelectric Power Project, rejecting the company’s claims in their entirety and ordering it and its promoter to refund the bulk of the country’s legal costs.
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Taken together, the two related claims had put Nigeria’s potential exposure at more than 3.38 billion dollars.
The final award, issued on 17 September 2026 and signed by the three members of the panel, came nearly nine years after the company commenced proceedings. It dismissed Sunrise’s claim for a declaration that Nigeria had breached its contractual obligations under a settlement agreement and its addendum.
What The Tribunal Decided
The tribunal rejected Sunrise’s claim for an order that Nigeria pay the company 400 million dollars, made up of a settlement sum of 200 million dollars and a default sum of a further 200 million dollars.
It further declared that Mr. Leno Adesanya, the promoter of Sunrise, is bound by the arbitration agreement with Nigeria pursuant to the settlement agreement and the addendum, and that the tribunal accordingly has jurisdiction over Nigeria’s counterclaim against him and his firm.
On costs, the tribunal ordered Sunrise and Mr. Adesanya to reimburse Nigeria 75 per cent of the legal fees and expenses the country incurred in the arbitration. Those fees were assessed at 11.82 million dollars, given precisely as 11,819,506.51 dollars, of which 2.5 million dollars is to be covered directly from the amount held in escrow by the ICC, to be released upon notification of the final award.
The company and its promoter were ordered to pay Nigeria the outstanding 9.32 million dollars, given precisely as 9,319,506.51 dollars, together with interest at an annual rate of 10 per cent, “compounded annually, from the date of the notification of this Final Award until such amount is paid in full.”
The costs of the arbitration itself, fixed at 1.66 million dollars, are to be borne as to 75 per cent by Sunrise and Mr. Adesanya and as to 25 per cent by Nigeria.
The panel was presided over by Ms. Melaine van Leeuwen, sitting with Mr. Stavros Brekoulakis and Mr. Simon Nesbitt as co-arbitrators. Nigeria was represented by a team led by Ms. Elizabeth Oger-Gross and Mr. Tolu Obamuroh, both now of Paul Hastings LLP.
How It Began
Sunrise commenced arbitration against Nigeria at the ICC International Court of Arbitration on 10 October 2017, seeking an award of 2.354 billion dollars for breach of contract in relation to a 2003 agreement to construct a hydroelectric plant at Mambilla in Taraba State on a build, operate and transfer basis, valued at 6 billion dollars. With interest, that claim is put at more than 2.7 billion dollars.
In the second arbitration, the company sought 400 million dollars, put at 680 million dollars with interest, on the footing that the Federal Government had failed to honour the settlement agreement the parties entered into in 2020 to bring the first arbitration to an end. Combined, the two claims exposed Nigeria to more than 3.38 billion dollars.
From 3,050MW To 1,500MW
The project at the centre of the dispute is no longer the one described in the 2003 contract. It was originally conceived as a 3,050-megawatt hydroelectric plant in Taraba State, and in 2016 the then Minister of Power, Works and Housing, Mr. Babatunde Fashola, described it as a scheme that would generate about 3,000MW.
In February 2021, the then Minister of Power, Mr. Saleh Mamman, announced that the Federal Government had revised the planned capacity downward by about 50 per cent, from 3,050MW to about 1,525MW, in order to reduce the project cost by roughly 1 billion dollars and make it more financially viable.
In July 2021, the same minister told the Senate Committee on Power that the project had been rescoped further, to about 1,500MW, to make it bankable and acceptable to lenders, explaining that the original 3,050MW capacity was not considered financially viable under prevailing market conditions.
The original project was estimated at about 5 billion to 5.8 billion dollars, while the rescoped project of roughly 1,500 to 1,525MW has been put at about 4 billion dollars.
Despite being identified by successive administrations as a major component of efforts to raise Nigeria’s electricity generation capacity, the project has remained largely on the drawing board, suffering repeated setbacks arising from legal disputes, financing difficulties and changes to its implementation arrangements. A Federal Ministry of Power implementation document identified the arbitration, the completion of financing arrangements with the Export-Import Bank of China, and the need to rescope the project among the challenges affecting its execution.
“I Never Approved It”
The origins of the 2003 contract were placed directly in issue by the former President, Chief Olusegun Obasanjo, who challenged his former Minister of Power, Mr. Olu Agunloye, to say where he derived the authority to award it.
“When I was president, no minister had the power to approve more than N25 million without express presidential consent. It was impossible for Agunloye to commit my government to a 6 billion dollar project without my permission, and I did not give him any permission,” Chief Obasanjo said.
“If a commission of inquiry is set up today to investigate the matter, I am ready to testify. I do not even need to testify because all the records are there. I never approved it.”
He gave an account of the memorandum presented to the Federal Executive Council on 21 May 2003: “When he presented his memo to the federal executive council, I was surprised, because he had previously discussed it with me and I had told him to jettison the idea, that I had other ideas on how the power sector would be restructured and funded.”
“I told him as much at the council meeting and directed him to step down the memo. I find it surprising that Agunloye is now claiming he acted on behalf of Nigeria. If I knew he issued such a letter to Sunrise, I would have sacked him as minister during my second term. He would not have spent a day longer in office.”
“I Refused To Approve The Settlement Deal”
The late President Muhammadu Buhari, for his part, denied authorising the 2020 settlement agreement, in a letter addressed to the Attorney-General of the Federation, Prince Lateef Fagbemi, SAN.
“While I understood that my ministers of justice, power and water resources were approached by Sunrise and were engaging with various stakeholders that were involved in the project to resolve the issues blocking the project’s implementation, at no time did I specifically instruct them to enter into and conclude any settlement agreement with Sunrise Power and Transmission Company Limited,” he wrote.
“Indeed, when the proposed settlement agreement and addendum were presented to me for my consideration and approval on 20th April 2020, I refused to approve the settlement deal because I was convinced that there was no basis for Sunrise’s claim.”
He linked the matter to an earlier and larger episode: “I hope the above clarifications will assist you in your defence of our country from these ‘invisible contractors who all too often quietly take Nigeria for many millions in out-of-court settlements’, as I stated in my recent statement regarding Nigeria’s victory in the P&ID saga.”
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