In the Matter of the Arbitration and Conciliation Act No. 11 of 1988 (Chapter A18 Laws of the Federation of Nigeria 2004)
The Arbitral Tribunal:
Professor Lawrence Boo (Chairman)
Lord Mark Saville of Newdigate
Professor Paul Obo Idornigie
1. The Claimants in these proceedings are:
a. STATOIL (NIGERIA) LIMITED, ("Statoil / 1st Claimant") a company incorporated under the laws of the Federal Republic of Nigeria ("Nigeria"), with registered office at 1A Bourdillon Road, Ikoyi, Lagos, Nigeria and another office address at Jiton Court, 1 Oyinkan Abayomi Drive, Ikoyi, Lagos, Nigeria. It is wholly owned by Statoil Nigeria AS which in turn is wholly owned by Statoil ASA, a company incorporated under the laws of Norway; and
b. TEXACO NIGERIA OUTER SHELF LIMITED ("TNOS/ 2' Claimant"), a company incorporated under the laws of Nigeria, with registered office at 2 Chevron Drive, Lekki Peninsula, Lagos, Nigeria. It is an indirect subsidiary of Chevron Corporation, a company incorporated in the United States of America.
The 1st Claimant and the 2nd Claimant are collectively referred to as the "Claimants".
2. The Respondent is NIGERIAN NATIONAL PETROLEUM CORPORATION.
("NNPC /Respondent"), a company incorporated pursuant to the Nigerian National Petroleum Act 1977 Cap N123 Laws of the Federation of Nigeria 2004 with head office at NNPC Towers, Herbert Macaulay Way, Central District, Garki, Abuja, Nigeria and of 7, Kofo Abayomi Street, Victoria Island, Lagos, Nigeria. It is wholly owned by the state of Nigeria.
3. The Claimants and the Respondent may each be referred to as a "Party" and are collectively referred to as the "Parties" hereinafter.
And we AWARD and ADJUDGE that -
VIII. The Respondent shall pay to the Claimants (jointly):
a. Damages calculated up to the date of this Award excluding the additional tax that would have been payable for the inter -company loans and the amount of such damages shall be calculated based on the Proceeds Imbalance as at 31 January 2015 adjusted to take into account the liftings of ACO by the Parties during the period from 1 February 2015 and the date hereof the amount representing the additional tax payable due to the non-deductible nature of the interest expense incurred on inter- company loans secured by the Claimants. If the Parties are unable to reach agreement on the amount to be deducted, the same shall be referred to the Tribunal for final determination.; and
b. Interest at the rate of LIBOR (1 month) +2 % on a simple basis on the respective amounts of Proceeds Imbalance (less such amount as properly representing the additional tax resulting for disallowing inter -company loans as tax deductible) up to date of full and final payment.
IX. The Respondent shall bear and forthwith pay to the Claimants the costs they have incurred in this arbitration which we hereby assess and fixed at US$2,882,922.08.
X. The Respondent shall bear and pay the costs of arbitration amounting in all to £626,872.03. The Claimants having paid advances towards the costs of arbitration shall be entitled to immediate reimbursement by the Respondent for such sum they have paid towards the cost of arbitration.
XI. The Respondent's Counterclaim stands wholly dismissed.
And we further DIRECT that:
XII. If within 60 days from the date of this Award, Parties are unable to reach agreement on the adjustments to be made as regard the award of damages and interests granted in Paragraph VIII(a) above,
a. the Claimants shall thereafter promptly file its submission and computation of the amount of such adjustments; and
b. the Respondent shall be at liberty to serve reply submissions and computation within 21 days thereafter.
XIII. Save and except that the Tribunal has retained its jurisdiction to make a final determination on the damages awarded herein, this Award is final as regard all other matters and claims made in this arbitration.