The London Court of Arbitration has ruled in favour of the UAE-based energy firm Dana Gas in the arbitration initiated against it in April by IPR Wastani Petroleum Ltd, disputing Dana Gas' right to terminate a sale and purchase agreement (SPA) relating to oil and gas assets in Egypt.
The award by the London tribunal now means the Egyptian assets will continue to be operated by Dana Gas, the company said.
On 19 July, the tribunal rejected IPR Wastani’s claim in its entirety and ruled in Dana Gas’ favour on all key points, concluding that Dana Gas’ termination of the SPA was valid, the Sharjah-based oil and gas company said in a statement Sunday on the Abu Dhabi Stock Exchange where it is listed.
Dana Gas terminated its agreement for the sale of its Egyptian assets to IPR Wastani on 22 April 2021 as the parties were unable agree on conditions.
Dana Gas’s board decided to terminate the SPA and retain and operate the assets in Egypt. IPR Wastani disputed Dana Gas’ right to terminate the SPA and submitted a request for arbitration.
Dana Gas Egypt collected $23 million in the first quarter of 2021. This increased to $75 million in the second quarter following the termination of the SPA. In total, Dana Gas Egypt has collected $98 million during H1 2021, compared to $43 million received in the same period of 2020, representing a 128 percent increase, it said in the statement.
Dana Gas is 5th largest gas producer in the country, currently producing around 30,000 boepd (barrels of oil equivalent per day) from 14 development leases. It will focus its attention on testing the potential of its offshore Block 6 Concession Area, estimated to contain more than 20 trillion cubic feet (Tcf) gas resources.
(Writing by Brinda Darasha; editing by Seban Scaria)
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© ZAWYA 2021