Nigeria has won a major international arbitration battle over the controversial Mambilla Hydroelectric Power Project, with an International Chamber of Commerce tribunal in Paris dismissing a $3.38bn claim brought by Sunrise Power and Transmission Company Limited.
The three-member tribunal also ordered Sunrise and its promoter, Leno Adesanya, to reimburse Nigeria 75 per cent of its legal fees and expenses, amounting to $9.32m, with interest at 10 per cent compounded annually from the date of notification of the final award until payment.
The ruling, issued on Thursday, September 17, 2026, represents a significant development in a dispute that has its origins in a controversial 2003 contract for the construction of a major hydroelectric plant in Taraba State.
President Bola Tinubu, in a statement welcoming the decision, described it as a major victory for Nigeria and said the ruling had removed the “single biggest legal hurdle” that had paralysed the Mambilla project for years.
He commended Attorney-General of the Federation and Minister of Justice, Lateef Fagbemi, the Federal Ministry of Justice and Nigeria’s legal team led by Elizabeth Oger-Gross and Tolu Obamuroh of Paul Hastings LLP.
The President also commended former President Olusegun Obasanjo and the late President Muhammadu Buhari, who testified in the arbitration, as well as former Power Ministers Babatunde Fashola and Suleiman Adamu and other witnesses and experts.
Tinubu said the ruling demonstrated the Federal Government’s resolve to defend the country’s interests against what he described as “predatory and exploitative claims by corrupt local and international entities and their enablers and funders.”
The tribunal, however, went beyond simply rejecting Sunrise’s monetary claim.
It dismissed the company’s claim that Nigeria had breached its obligations under a settlement agreement and addendum and rejected its demand for $400m, comprising a $200m settlement sum and another $200m allegedly payable as a default amount.
The tribunal also ruled that Adesanya was bound by the arbitration agreement with Nigeria and that it had jurisdiction over Nigeria’s counterclaim against him and his firm.
The arbitration costs were fixed at $1.6565m, with Sunrise and Adesanya ordered to bear 75 per cent and Nigeria 25 per cent.
Of the $11.82m in legal fees and expenses incurred by Nigeria, $2.5m is to be recovered directly from funds held in escrow by the ICC, while Sunrise and Adesanya are required to pay the remaining $9.32m, plus interest.
How the Mambilla dispute began
The dispute dates back to May 2003, when then Minister of Power and Steel, Olu Agunloye, awarded Sunrise a contract to develop the Mambilla hydroelectric project under a build-operate-transfer arrangement.
The original contract envisaged a 3,050-megawatt plant and was valued at about $6bn.
Sunrise subsequently claimed that Nigeria had breached its contractual obligations, leading the company to commence arbitration at the ICC International Court of Arbitration on October 10, 2017, seeking about $2.354bn in compensation.
The dispute later generated a second arbitration after a settlement agreement was reached in 2020. Sunrise claimed that Nigeria had failed to honour the settlement, prompting its demand for another $400m.
The latest tribunal ruling has now rejected those claims.
The outcome is particularly significant because the validity of the original 2003 contract has also become the subject of a criminal prosecution against Agunloye by the Economic and Financial Crimes Commission.
Agunloye’s trial casts long shadow over project
Agunloye is standing trial before the Federal Capital Territory High Court in Abuja over allegations arising from the award of the Mambilla contract.
The former minister has pleaded not guilty to the charges.
A central issue in the prosecution’s case is whether Agunloye had the authority of then-President Obasanjo or the Federal Executive Council to commit the Nigerian government to the $6bn project.
Obasanjo has repeatedly denied giving such approval.
In a 2023 media interview, the former President said no minister in his administration could approve more than N25m without presidential consent and insisted that Agunloye could not have committed the government to a $6bn project without his authorisation.
Obasanjo said Agunloye had presented the matter to FEC on May 21, 2003, but that he had directed him to withdraw the proposal, having already told the minister that he had other plans for restructuring and funding the power sector.
“I never approved it,” Obasanjo said.
The former President also challenged Agunloye to explain the authority under which the minister subsequently issued the contract award letter to Sunrise.
The prosecution has relied on evidence suggesting that the FEC did not authorise the contract and that the purported award letter issued to Sunrise was not validly authorised.
Agunloye, however, has denied the allegations against him.
Buhari also rejected 2020 settlement
The dispute was further complicated by the 2020 settlement agreement, which Sunrise relied upon in pursuing its subsequent $400m claim.
But the late former President Buhari also denied authorising the settlement.
In a letter to the current Attorney-General, Buhari said that although his Ministers of Justice, Power and Water Resources had engaged Sunrise and other stakeholders in attempts to resolve the dispute, he had never instructed them to conclude a settlement with the company.
Buhari said the proposed settlement agreement and addendum were presented to him for consideration on April 20, 2020, but that he refused to approve them because he believed there was no basis for Sunrise’s claim.
He urged the government to defend Nigeria against what he described as “invisible contractors” who could otherwise extract millions of dollars from the country through out-of-court settlements.
EFCC investigation continues
The Mambilla controversy has therefore straddled both criminal proceedings in Nigeria and international commercial arbitration abroad.
The EFCC has investigated the circumstances surrounding the original contract, while prosecutors have presented evidence concerning the alleged unauthorised award and alleged financial dealings involving Agunloye and Sunrise promoter Adesanya.
The criminal trial and the arbitration are legally distinct proceedings, meaning Thursday’s ICC award does not determine Agunloye’s criminal culpability.
That issue remains for the Nigerian court to determine on the evidence presented before it.
The arbitration ruling removes a potentially enormous financial liability and clears an important obstacle surrounding one of Nigeria’s most ambitious but longest-delayed power projects.
Tinubu said Nigeria remained committed to genuine investors and to honouring its lawful obligations, but would “strongly” defend the nation’s commonwealth against what his administration considers opportunistic claims.
The Mambilla project, conceived as a major source of additional electricity for Nigeria, has remained stalled for decades amid contractual, legal, financing and implementation controversies.
Thursday’s decision now gives the government a fresh opportunity to pursue the project without the immediate arbitration exposure that has shadowed it for years.
