Two former Nigerian presidents – Olusegun Obasanjo and Muhammadu Buhari – and an ex-power minister, Babatunde Fashola, are in Paris to testify in an arbitration case instituted by Nigerian businessman Laitan Leno Adesanya and his company, Sunrise Power and Transmission Company, over a revoked $6bn electricity project in Mambila, northeast Nigeria. Who is Adesanya?
Like many wealthy Nigerians today, Adesanya’s wealth is traced to several oil and gas contracts approved by the military government.
Educated in the US, Adesanya also worked for Citibank stateside before returning to Nigeria during the military regime of General Ibrahim Babangida (1985-1993).
Oil man
Adesanya’s biggest companies are Lutin Investments in Geneva, and its Nigerian arm, Lenoil Holdings, established in 1988.
His companies supplied ocean vessels with equipment for the storage of petroleum products and engaged in other oil activities. Adesanya owns 50% of Lutin and is the CEO. His wife, Noimot Ibironke, and his children also own stakes in his companies.
During Babangida’s regime, Lutin Investments and Lenoil were awarded many lucrative contracts from the Nigerian National Petroleum Corporation (NNPC), Nigeria’s national oil firm. This sparked rumours in the media that then-president Babangida’s influential wife, Mariam, was one of the owners of Lenoil.
After Babangida’s regime came to an abrupt end, the new power brokers sought to revoke existing agreements his companies had with NNPC.
Revoking has a price
In 1993, Lutin Investments dragged NNPC before international arbitration.
In May 2007, the arbitrator, France’s civil court Tribunal de Grande Instance, awarded Lutin damages against NNPC for $55.2m, plus 10% compound interest; £20,480, plus 10% compound interest; and N4,692,930, plus 21% compound interest. All interest obligations began to accrue on 7 July 1993, court documents state.
The NNPC petitioned the Paris Court of Appeal, which upheld the original verdict. However, the national oil firm delayed obeying the judgment – the sum has risen to about $277m due to accruing interest.
By the mid-2010s, Adesanya was swimming in debt, owing Sterling Bank some $2.3m. After putting pressure on the NNPC to pay him, then-president Goodluck Jonathan eventually approved the payment of $55.2m, leading to another round of disputes.
With his newly registered Sunrise Transmission Company set up in the early 2000s, Adesanya invested in the electricity power sector, starting as a middleman. He enjoyed unfettered access to the Presidential Villa during the early years of the Obasanjo administration but soon fell out of favour with the former president for reasons unknown.
However, after Obasanjo’s exit, Adesanya was favoured by Jonathan, who held office from 2010 to 2015. After Jonathan’s exit, Adesanya was arrested by Nigerian authorities for paying $1.85m into a bank account allegedly on the instruction of erstwhile oil minister Diezani Alison-Madueke. Investigators claim the money was part of a $115m slush fund used to bribe electoral officials in 2015.
Adesanya’s name also features in the Pandora Papers published by the International Consortium of Investigative Journalists which stated that Adesanya set up a shell company for powerful National Security Adviser Sambo Dasuki, who was accused of diverting $2.1bn meant for arms.
Adesanya has since left Nigeria and resides mostly in Dubai and the US, saying he escaped an assassination attempt in Nigeria.
The $2.3bn Mambila case
Now Adesanya is engaged in yet another dispute with the Nigerian government. This time it is regarding the $6bn Mambila Hydropower project.
The project was first conceived in 1982 and was supposed to bring succour to millions of Nigerians who have for decades grappled with an inconsistent power supply.
Although it was first conceived in 1982, it wasn’t until 2003 during the administration of Obasanjo that Nigeria approved the $6bn contract to Sunrise and a consortium of Chinese companies to construct what was to be Africa’s largest hydroelectric power plant.
The project, upon completion, was expected to boost the country’s power generation capacity by 3,050MW. The entire cost of the project was to be borne by Sunrise and its partners which would then transfer ownership to the Nigerian government after the agreed period.
However, just days before Obasanjo left office, the contract was revoked and awarded to China Gezhouba Group Corporation/China Geo-Engineering Corporation (CGGC/CGC) at the modified cost of $1.46bn as the project was scaled down.
Sunrise, which felt aggrieved, wrote a petition to then-president Umaru Musa Yar’Adua, accusing some officials of the Obasanjo administration of revoking the contract after the new contractors had paid a bribe of $15m. Yar’Adua subsequently reinstated Sunrise’s contract.
In 2012, the Nigerian government followed up by signing an agreement with Sunrise authorising the firm and its Chinese partners to proceed with the project. However, in 2017, the Buhari administration signed a separate $5.8bn contract with another Chinese grouping, Sinohydro Consortium. However, the Chinese EXIM bank refused to fund the project due to the legal tussles.
Nigeria failed to pay up, citing dwindling revenues
Sunrise took legal action against the Nigerian government and Sinohydro Consortium, demanding $2.3bn as compensation. Buhari held talks with Sunrise boss Adesanya and Chinese officials on the way forward.
Fraudulent contract?
In 2020, it was agreed that Nigeria would pay Sunrise $200m to drop all its claims to Mambilla – but an additional $200m and interest would be paid if the Nigerian government failed to pay within six months.
Nigeria failed to pay up, citing dwindling revenues. This forced Sunrise to return to arbitration, but Nigerian authorities had other plans.
At the time, Obasanjo said he never approved the contract in the first place and that it was thus fraudulent from the beginning. This gave Nigeria’s Economic and Financial Crimes Commission (EFCC) – the anti-corruption watchdog – the impetus to arraign former power minister Olu Agunloye for contract fraud. Agunloye denies the allegations.
The EFCC also declared Adesanya a wanted man, accusing him of giving kickbacks to Agunloye. The EFCC says Sunrise paid N3.6m ($9,473, adjusted for inflation) into Agunloye’s bank account in 2019. Adesanya dismisses the bribe allegations, insisting that the money was paid 16 years after the contract was approved and was given to Agunloye as payment for health costs.
The Sunrise boss accuses the Nigerian government of a witch-hunt and attempting to discredit the transaction to prejudice the current arbitration in Paris. (Africa Report)
