By Derrick Bangura.

Nigeria’s low-carbon energy project has received a £10 million injection from the United Kingdom. The concessional financing will help Nigeria meet its COP26 obligations by lowering risks and encouraging pension and insurance funds to invest in energy access initiatives.

Following a successful investigation by the British Serious Fraud Office into the employment of corrupt agents in the oil and gas sector, the UK negotiated an agreement with the Nigerian government that would allow the country to receive £210,610 in compensation.

On Monday, the governments of Nigeria, the United Kingdom of Great Britain, and Northern Ireland signed a Memorandum of Understanding (MoU) pledging to work together to combat corruption.
The MoU was signed by Vicky Ford, the UK’s Minister for Africa, and Abubakar Malami, the Attorney General of the Federal Republic of Nigeria and Minister of Justice, who was represented by Mohammed Umar, the Permanent Secretary in the Ministry of Justice. It lays out the terms and conditions under which the UK and Nigerian governments will make the reparation payment.

“The Security and Defence Dialogue conducted in February 2022 between our two countries reinforced both the UK and Nigeria’s resolve to work together to counter illicit financial flows, bribery, and corruption,” Ford stated during the signing of the MoU.

“The United Kingdom has a zero-tolerance stance toward corruption, and we trust that today’s signing demonstrates our commitment to this.”

She stated that in a global economy where international trade is critical, corporations must operate with honesty and openness more than before.
Illicit money flows, bribery, and corruption have all been cited as key roadblocks to both countries’ economic progress, commerce, and security.

A four-year corruption probe launched by the UK’s Serious Fraud Office (SFO) resulted in the reparation payout from the UK to Nigeria. The funds were recovered through a Deferred Prosecution Agreement (DPA), in which the prosecutor agrees to drop charges in exchange for the defendant consenting to certain conditions, such as recognizing criminal responsibility and paying the required reparation.

The DPA was reached with Amec Foster Wheeler (AFWEL) in this matter, and it related to the use of corrupt agents in the oil and gas industry.

The payment proved that if such offenses were discovered, the UK Serious Fraud Office (SFO) would investigate the corporations and, if proof was discovered, ensure that they were subjected to appropriate sanctions.
The UK government remitted £4.2 million to Nigeria in March 2021 from cash recovered from former Delta State Governor James Ibori’s cronies.

“The Government of the United Kingdom shall transfer the compensation payment in the sum of £210,610 (118.4 million Naira) within twenty-eight (28) days from the date of signing this MOU,” according to the agreement.

“The MoUs confirm that the Nigerian government has promised to use the returned monies for projects that will benefit and improve the country in both cases.”

“The United Kingdom will continue to restore all illicit assets, whatever of value, in accordance with the United Nations Convention Against Corruption (UNCAC).”

“We take a zero-tolerance approach to corporations who think they can bribe their way to financial success,” stated Lisa Osofsky, Director of the Serious Fraud Office in the United Kingdom. Bribery and corruption not only hamper real economic progress and free trade, but they also harm democracy, putting all of our countries’ security at risk.
“I am, of course, delighted that the tenacity of my SFO colleagues has resulted in the people of Nigeria being compensated in a way that will truly benefit them.”

Malami, while thanking the UK for the gesture, promised that the repatriated fund would be expended on the Lagos-Ibadan Expressway, Abuja to Kano road, and the Second Niger Bridge.

On UK’s injection of £10 million of concessional financing alongside InfraCredit to mobilise pension and insurance investments, the statement noted that it would help to reduce the risk for pension and insurance funds to invest in energy access projects, and support Nigeria’s COP26 commitments.

The financing would also help Nigerian investors focus on low carbon energy, and support off-grid, low-carbon energy projects. Additionally, the £10 million would be blended to de-risk transactions and, therefore, mobilise domestic institutional investment from local pension funds, insurance firms and other local institutional investors. This would help scale up domestic financing for eligible off-grid clean energy infrastructure, such as solar mini-grid and home systems, clean cooking infrastructure and SME cold storage infrastructure in Nigeria.

UK Minister for Africa, Vicky Ford, speaking on the investment, said, “The UK is committed to increasing both renewable energy and energy access in Nigeria, driving clean, sustainable and resilient growth.

“As the world looks to transition to clean growth, we are witnessing an era-defining opportunity for the private sector. This transaction is particularly exciting as it brings together UK government support with the institutional capital, which is essential to grow the sector at scale.

“This innovative blended finance initiative will provide affordable long-term financing from local investors for the low carbon energy sector to support scaling up of off-grid low carbon energy projects in unserved and underserved communities.

“This initiative will support the implementation of Nigeria’s Nationally Determined Contributions plan, which Nigeria submitted to the UNFCCC before COP26, its Energy Transition Plan, which was presented by the Nigerian government at COP26, and Nigeria’s plans to increase energy access, including the Solar Naija programme.”

On his part, the MD/CEO, Nigerian Sovereign Investment Authority (NSIA), and Chairman of InfraCredit, Uche Orji said:

“InfraCredit is pleased to be working with FCDO to mobilise private investment from domestic pension funds and other institutional investors into such an important developmental area as low carbon energy access.

“This programme is aligned with NSIA’s other clean energy initiatives which aims to deliver up to 250-500MW of renewable energy capacity in Nigeria that will reduce annual CO2 emissions, alleviate poverty, create jobs and support local economic growth.”

Speaking at the announcement, the Minister of State for Power, Mr. Godwin Jedy-Agba, said with the support from the UK Government’s Energy Transition Council showed the pathway to an energised economy and carbon neutrality by 2060. The assistance also highlighted the need for additional investments of $410 billion above business as usual over the next 40 years.

Jedy-Agba stated, “Whereas all efforts have been geared towards unlocking private sector activity in the clean energy transition, one major challenge continues to be private sector access to local currency financing. This is where local institutions such as pension and insurance funds have a key role to play, as only these institutions possess the scale of local currency liquidity required to accelerate the transition.”

The Minister of Foreign Affairs, Geoffrey Onyeama, at a meeting with Ford said the federal government looked forward to cooperate with the United Kingdom (UK) in the security of the West African sub-region.

Onyeama received, in audience, the United Kingdom Minister for Africa, Latin America and the Caribbean. He expressed gratitude to the government of the United Kingdom for its extensive and significant support in diverse areas, stating that the West African sub-region is facing huge security challenges, including governance challenges.

He noted that the COVID-19 pandemic had a big hit on the economies of the world and also expressed gratitude to the United Kingdom for support during the period, particularly with vaccines and other support in the area of health.

Onyeama added that the United Kingdom had been involved in the security of the West African sub-region, saying a lot is going on in the sub-region, particularly in Mali, Guinea, and Burkina Faso with the support of the United Nations.

The minister said, “So, we look forward to continuing to cooperate with you in this area because we feel that it is not something that we can do alone in the sub-region.

“We need the United Nations’ support and also the support of European countries. We have been engaged and in the framework of the G5 Sahel and other initiatives.”
Ford went on to say that the UK would be speaking with the Nigerian government about how to help with community policing, training, and upgrading the police force.

Ford, on the other hand, stressed that the move was a collaborative effort rather than the UK dictating Nigeria what to do.

“This was us listening, exchanging experiences, especially from national security areas that we may have seen and experienced both in our country and around the world, and putting our experiences together,” she continued.