Tolulope Aderemi
ABSTRACT
Commercial disputes as with other facets of human interaction are inevitable. In the early oil and gas market era, unilateral action was the order of resolving disputes. With the exponential growth in the global energy market, disputes have consequently become more incremental and their resolution, more nuanced to ensure minimal or nil disruptions to operational activities. A mechanism that accommodates the character and resolution of such disputes is arbitration. This is so because it accommodates expert determinants in what has become a very technical and complex area, and which requires expert guidance for its resolution. However, the incursion of stringent regulations into settlement of disputes has become a point of challenge to arbitral awards in the energy sector, making the recognition and enforceability of energy awards more complex. This article examines how to effectively navigate the interstices of recognition and enforcement of energy arbitral awards. In particular, it examines the impact of section 50 of the National Power Sector Reform Act 2005 and section 11 of the Petroleum Act on adjudication of energy disputes in Nigeria, especially on the arbitrability of tax disputes in Production Sharing Contracts (PSCs). This article demonstrates that before arbitration clauses are inserted in contracts of parties in the energy sector, recourse should be had to the possible effect of statutory regulations on such disputes which may oust the jurisdiction of the arbitrator(s), and consequently make otiose the enforcement of the arbitral award made pursuant thereto.
Keywords: Energy Arbitration; Production Sharing Contracts; Arbitral Awards; Recognition; Enforcement.