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Lagos oilfield dispute worsens, another investor heads for court

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The dispute among joint venture partners in Aje oil field, offshore Lagos, appears to have escalated as another partner, EER (Colobus) Nigeria Limited, has gone to court.

One of the partners, Panoro Energy, announced in December that it was in disagreement with its JV partners over cash call and intended to initiate arbitration and legal proceedings to protect its interests.

The company holds 6.502 per cent participation interest in Oil Mining Lease 113, where the Aje field is located, through its subsidiary, Pan Petroleum Aje Limited.

The commercial court division of the High Court in London granted the PPAL an interim injunction, restricting the JV partners from taking any action under the default provisions of the Joint Operating Agreement that would prevent the PPAL’s continued participation in the JOA and OML 113.

Panoro Energy said in a new update that the EER (Colobus) Nigeria applied for and, on July 13, 2017, was granted an order by the Federal High Court of Nigeria, adding that the court set the time to hear the motion on notice as July 24, 2017.

It said, “It is Panoro’s understanding that the EER, like Pan Petroleum, is in default of certain of its cash calls under the JOA and, therefore, the court’s order restrains any of the non-defaulting joint venture partners from issuing a notice under the JOA requiring the EER and, perhaps Pan Petroleum, to withdraw from and transfer all its interests and rights in the OML 113 and the JOA to all the non-defaulting parties.”

According to the company, under the JOA, the potential consequence of a JV partner not making payment of its share of a cash call on or before the expiry of the 45-day grace period is that two or more of the other JV partners, who are not themselves in default and represent a majority of the interests not in default, have the option to require the defaulting party to withdraw from the OML 113 and the JOA by issuing a notice of withdrawal.

…Punch, July 20, 2017

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