04 June 2012
MUSCAT - The Board of Directors of SMN Power Holding SAOG announced yesterday that its fully-owned subsidiary SMN Barka Power Company SAOC (SMNBPC) has agreed to settle a dispute with its EPC Contractor, Doosan Heavy Industries and Construction Co Ltd
The execution of the settlement agreement on June 2, 2012 settles the outstanding dispute between SMNBPC and Doosan, principally concerning delays to the Early Power Commencement Date, the Commercial Operating Date and some technical issues.
In accordance with the terms and conditions of the settlement agreement Doosan relinquishes all
cost claims and pays to SMNBPC an amount of $27 million in respect of delay liquidated damages under the EPC Contract, net of any additional works.
(ii) an amount of $19.3 million of liquidated damages due to the off-taker under the PWPA and already paid by SMNBPC to OPWP in 2011.
(iii) an amount of $5.3 million as compensation for non-punch list and punch-list items for the outstanding works to be carried-out by SMNBPC; and
(iv) settles all outstanding invoices issued by SMNBPC for a total amount of $0.5 million.
As also provided for in the settlement agreement and disclosed in the Financial Projections, SMNBPC shall pay an amount of $42.3 million for milestones payments withheld under the EPC Contract and release
the Performance Bond for an amount of $40 million and decrease the level of the Money Retention Bond to $5 million.
All payments arising from or in connection with the settlement agreement have been made by SMNBPC and Doosan, resulting in a positive cash flow of $9.9 million for SMNBPC.
The settlement with Doosan does not have any material adverse impact on SMNBPC financials nor those of SMN Power Holding SAOG, the company said in a disclosure notification to the Capital Market Authority.
MUSCAT - The Board of Directors of SMN Power Holding SAOG announced yesterday that its fully-owned subsidiary SMN Barka Power Company SAOC (SMNBPC) has agreed to settle a dispute with its EPC Contractor, Doosan Heavy Industries and Construction Co Ltd
The execution of the settlement agreement on June 2, 2012 settles the outstanding dispute between SMNBPC and Doosan, principally concerning delays to the Early Power Commencement Date, the Commercial Operating Date and some technical issues.
In accordance with the terms and conditions of the settlement agreement Doosan relinquishes all
cost claims and pays to SMNBPC an amount of $27 million in respect of delay liquidated damages under the EPC Contract, net of any additional works.
(ii) an amount of $19.3 million of liquidated damages due to the off-taker under the PWPA and already paid by SMNBPC to OPWP in 2011.
(iii) an amount of $5.3 million as compensation for non-punch list and punch-list items for the outstanding works to be carried-out by SMNBPC; and
(iv) settles all outstanding invoices issued by SMNBPC for a total amount of $0.5 million.
As also provided for in the settlement agreement and disclosed in the Financial Projections, SMNBPC shall pay an amount of $42.3 million for milestones payments withheld under the EPC Contract and release
the Performance Bond for an amount of $40 million and decrease the level of the Money Retention Bond to $5 million.
All payments arising from or in connection with the settlement agreement have been made by SMNBPC and Doosan, resulting in a positive cash flow of $9.9 million for SMNBPC.
The settlement with Doosan does not have any material adverse impact on SMNBPC financials nor those of SMN Power Holding SAOG, the company said in a disclosure notification to the Capital Market Authority.
© Oman Daily Observer 2012
