Bangladesh appoints UK law firm for int'l arbitration against Adani

Bangladesh has appointed a British law firm to represent the Bangladesh Power Development Board (BPDB) in mediation proceedings at the Singapore International Arbitration Centre against Adani Power Limited, a significant step in the long-running dispute over coal pricing and power tariffs.

Confirming the development, BPDB Chairman Md Rezaul Karim told The Business Standard that the nominees' names had already been submitted to SIAC on behalf of the state utility.

Power Division officials said the appointed firm is 3 Verulam Building, a UK-based law chambers headed by King's Counsel Farhaz Khan, who has been advising the National Review Committee for several months.

To support the King's Counsel, BPDB has also appointed two local experts, one from the power sector and another a Supreme Court lawyer, officials added.

In a separate development, an international arbitration has ordered Canadian energy company Niko Resources to pay $42 million in compensation to Bangladesh over the Chhatak gas field blowouts in 2005.

The verdict of the International Centre for Settlement of Investment Disputes (ICSID) was conveyed to the government through official channels a few days ago, Petrobangla Chairman Rezanur Rahman told TBS.

Appointees against Adani

Bangladesh's appointments in the Adani case come within five days of the release of the final report of the National Review Committee, which detailed power sector agreements signed during the ousted Awami League government.

BPDB Chairman Rezaul Karim said two local experts had been appointed, one from the legal field and another from the power sector, and their names were already sent to SIAC to assist the King's Counsel.

Power Division sources said the two appointees are Rezwan Khan, chairman of Power Grid Bangladesh, and barrister Ehsan Abdullah Siddiq, a partner at The Law Counsel. The move brings together legal and technical expertise to support Bangladesh's case at SIAC.

Contacted by TBS, barrister Ehsan Abdullah Siddiq declined to comment, saying he had not yet received a formal appointment letter, though he acknowledged providing legal opinions during the deal review.

Rezwan Khan said he had been verbally informed of his appointment as a technical expert but had not yet received written confirmation. He added that the power and energy adviser had earlier contacted him to seek consent to participate in mediation-level proceedings.

Established in 1991, SIAC is a leading independent, not-for-profit institution specialising in international arbitration in Asia.

BPDB vs Adani

BPDB and Adani Power signed a 25-year power purchase agreement in November 2017 to import 1,496 megawatts of electricity from Adani's 1,600MW coal-fired plant in Jharkhand, India. The first 800MW unit began commercial operations in April 2023.

In a letter dated 21 May 2025, Adani Power President Krishna Rao invoked Section 19.3 of the agreement, asking BPDB to appoint a mediator within 15 days to begin arbitration. Adani nominated four international arbitration specialists, including Lawrence Boo, Lucy Reed, Toby Landau KC and VK Rajah SC.

Adani Power initiated arbitration at Singapore International Arbitration last year, claiming about $485 million in unpaid dues linked to the disputed coal tariff. Under the agreement, mediation is a mandatory but non-binding step before full arbitration.

Bangladesh has argued that Adani is charging an excessively high coal price, inflating electricity generation costs. After the fall of the Sheikh Hasina-led government during the July uprising, BPDB intensified efforts to reopen negotiations with Adani. 

Multiple online meetings between officials failed to produce a breakthrough, prompting Adani to again request BPDB to choose a mediator. BPDB responded by saying mediation would not proceed until the National Review Committee completed its assessment.

Strong case against Adani

On 25 January, when the review committee's report was published, member Mushtaq Husain Khan urged swift action, warning delays could weaken Bangladesh's legal position.

The committee estimated Bangladesh is paying an extra $400 million to $500 million annually because of flaws in the coal pricing formula and tax provisions.

Power and Energy Adviser Fouzul Kabir Khan said the committee had gathered direct and circumstantial evidence of bribery involving Bangladeshi officials during the deal's signing.

Investigators documented suspicious transactions through foreign bank accounts, with records of account numbers, dates, times and beneficiaries, according to the committee.

Members said the evidence was independently reviewed and validated by a team of expert lawyers led by a UK-based King's Counsel.

The legal team concluded Bangladesh has sufficient grounds to file a fraud case against Adani Power over alleged bribery and corrupt practices.

Niko to pay Bangladesh $42m

In the Niko case, Petrobangla officials said Bangladesh had sought nearly $1 billion in damages but the tribunal awarded a far lower amount.

Petrobangla has yet to receive the full verdict, though a summary has been obtained and discussed at a Bapex board meeting on Tuesday.

Petrobangla Chairman Rezanur Rahman said the complete ruling would be sent to the Attorney General's Office for legal opinion before deciding the next steps.

In 2003, Niko Resources (Bangladesh) Ltd signed a joint venture with Bapex to develop gas fields in Feni and Chhatak, while Petrobangla agreed to purchase gas from Feni.

Operations at the Tengratila gas field went disastrously wrong in 2005, when two blowouts caused loss of life, environmental damage and severe harm to the gas field.

A government probe later found serious faults in Niko's drilling practices, prompting Petrobangla to seek compensation through the courts.

Bangladesh claimed $118 million in damages for Bapex and a further $896 million for the government, citing environmental destruction and economic losses.