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Monday, February 17, 2014
Swala Energy and Tanzania’s TPDC have terminated negotiations for the Eyasi license. TPDC was negotiating with Swala’s 65.13% owned subsidiary Swala Oil & Gas Tanzania (SOGTP).
SOGTP originally bid for the Eyasi license on a 50/50 basis with a joint bidding partner. The joint bidding agreement allowed either party to withdraw at any stage, with the remaining party assuming the withdrawing party’s interests in the license. SOGTP’s bidding partner withdrew from the process and TPDC deemed this to be a breach of the tender guidelines that governed the process. SOGTP disagrees with TPDC’s interpretation and has advised TPDC that it will seek advice on challenging this decision.
CEO Dr. David Mestres Ridge said: “We are disappointed that TPDC has reached such a questionable decision, especially considering SOGTP’s track record in Tanzania over the past two years. The company has invested significantly in the negotiation for Eyasi and TPDC’s decision raises questions not only in respect of the transparency of the process that will be followed in the current licencing process but also in respect of TPDC’s commitment to local content and Tanzanian participation. We remain committed to Tanzania and shall advise the market further once the outcome of our challenge has been determined.”
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