The state-run Petrobangla has finally lost to Niko Resources over payment against gas sales, as an international court gave its final verdict, saying it would have to pay 234.16 crore taka as compensation.
The International Center for Settlement of Investment Disputes (ICSID) upheld its previous verdict today, which was delivered on 11 September 2014, following a claim raised by Niko against Petrobangla over payment against gas supply from Feni gas-field.
Petrobangla initially made payments to Niko Resources, but later stopped paying in line with verdict from local court, following two consecutive blowouts in Niko-operated Chhatak gas-field in Sunamganj. Cases has been filed against Niko for a compensation of 746.50 crore taka on that regard.
In its verdict, ICSID narrated that Petrobangla will have to pay approximately $25 million plus approximately Tk 140 million as per invoices for the gas, delivered from November 2004 to April 2010. In addition, Petrobangla will pay interest to September 11, 2014 of approximately $6 million and approximately Tk 50 million.
ICSID pointed out that Petrobangla will make payments into escrow accounts, which will be opened by Niko at a reputable internationally-operating bank. The funds in the accounts will be released only as instructed by the Tribunal or by joint instructions of Niko and Petrobangla.
Niko Resources attained operator-ship of Feni field under the terms of a 2003 joint venture agreement (JVA) with Bapex, which gave it an 80 per cent stake. The remaining 20 per cent went to Bapex.
The company also attained exploration rights over three onshore gas fields – Feni, Chhatak and Kamta – following the JVA, as the fields were declared ‘abandoned’ by Petrobangla. Niko succeeded in striking the deal without any competitive bidding.
Currently Niko has 60 per cent stakes in onshore Block-9 that produces around 110 mmcfd of gas from Bangura field, while 30 per cent including operatorship goes to Tullow, and remaining 10 per cent to Bapex.
Source – Sheershanews