Petroleum Africa
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Wednesday, March 30, 2016
Cooper Energy’s partners on the Hammamet Permit in Tunisia have served the company with a Request for Arbitration. Cooper’s partners, Medco Ventures International and DNO Tunisia, hold differing opinions on the terms of the joint operating agreement than Cooper does.
Cooper Energy has previously reported its intention to withdraw from Tunisia and consistent with this, its wholly owned subsidiary CE Hammamet Ltd. elected not to participate in the most recent extension of the Hammamet Permit and issued a notice to withdraw from the JV on June 16, in accordance with the terms of the joint operating agreement.
The parties hold differing opinions regarding the interpretation of the terms of the joint operating agreement regarding ongoing liability to pay for work obligations which may be undertaken during the extension period of the permit following the withdrawal. The remaining JV parties are now seeking security from CE Hammamet Ltd. for a 35% share of the cost of drilling a well in the Hammamet Permit, a share which they assert to be at least $13.1 million. They also seek an unspecified amount of damages for the claimed breach of the joint operating agreement. The remaining joint venture parties have invoked the dispute resolution procedure under the joint operating agreement.
CE Hammamet Ltd. believes the claim to be without merit and denies any liability for activities undertaken during an extension period of the permit in which it has elected not to participate. CE Hammamet Ltd. is unaware of firm plans for a well to be drilled at all.
Accordingly, Cooper Energy considers that it is not obliged to provide the security as requested by the remaining joint venture parties and that it is in shareholders’ interests to defend the claim which it intends to do with vigor.
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