Nigeria lodges $200 million to delay asset seizures in $9 billion case

The Nigerian government said Friday it had lodged a guarantee for $200 million with a British court to hold off asset seizures as it proceeds with an appeal against a $9 billion award over a failed gas contract.

Nigeria is locked in a bitter dispute with offshore firm Process and Industrial Developments Limited (P&ID) over a 2010 deal for a plant to turn natural gas burned off during oil production into electricity. The deal fell through after the two parties exchanged mutual recriminations, sparking a protracted legal wrangle that saw the company claim vast sums in lost revenues. A British judge in August gave the green light for P&ID to seize more than $9 billion in assets from the Nigerian government, an amount representing one-fifth of the country's foreign reserves.

Nigeria won the right to appeal that ruling in late September and was granted a stay of execution provided it make a $200-million security payment within 60 days. Attorney General Abubakar Malami said earlier that the authorities were challenging the demand for the funds to be deposited. But on Friday his office confirmed that Nigeria had posted a "bank guarantee" for $200 million which can only be withdrawn by the court if the government's appeal does not succeed.

P&ID confirmed that the bank guarantee had been deposited in a statement. The multi-billion dollar dispute has rocked the Nigerian authorities and sent them scrambling to try to overturn the judgement. The country's anti-graft agency has launched a probe into the original deal, arguing that it was fraudulent and amounted to economic sabotage.

P&ID insists that the Nigerian government is trying to discredit the deal in a bid to overturn the UK court ruling.