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01/06/2017 04:27 AST
Dana Gas and its partners are seeking damages of at least $26.5 billion (Dh97.2 billion) from Iraq’s self-governing Kurdish region for delays in oil and natural gas projects, a US court filing shows. The company’s shares gained the most in more than three months.
UAE-based Dana Gas and its partners in the venture, called Pearl Petroleum, filed a petition on May 12 in a federal court in Washington, DC, seeking “recognition and enforcement” of awards in a London arbitration case, according to the US court documents. The petition is part of a legal process that may allow Pearl Petroleum to seize Kurdish assets if the Kurds don’t pay awards decided in arbitration.
The Kurdistan Regional Government (KRG) “considers that the claimants’ approach in the arbitration is unconstructive and unnecessarily escalates the dispute,” its energy ministry said Wednesday in a statement posted on its website. “The KRG will continue vigorously to pursue its rights and defend its position in all appropriate forums,” the ministry said Tuesday in an emailed statement.
Dana Gas declined to comment on the US court filing, while Crescent Petroleum, its biggest shareholder and also a party to the filing, didn’t have an immediate comment.
The partners are pursuing claims in the London Court of International Arbitration against the KRG for damages for delays they say were caused by the KRG in developing the projects. Dana Gas hasn’t previously disclosed the amount of damages it’s seeking in the case.
The shares jumped 5.1 per cent, the most since February 14, after climbing the most in more than a year in intraday trading. The company has lost about a quarter of its market value in the past six months, to Dh2.9 billion ($778 million).
Unpaid receivables
Dana Gas, which is developing the Khor Mor and Chemchemal fields in northern Iraq through Pearl Petroleum, produces most of its oil and gas in Iraq and Egypt. Unpaid receivables from both countries have hurt the producer’s ability to invest and repay creditors. The company, which had about $298 million of cash on hand at the end of March, is seeking to renegotiate terms on about $700 million in Islamic bonds due in October.
In November 2015, the London arbitration court awarded Pearl Petroleum about $2 billion for disputed and delayed payments. The venture has yet to collect all the money. The London tribunal ruled in January that the KRG had also impeded Pearl Petroleum’s development work on fields in the region and said the court needed more time to decide the amount of damages to be awarded, according to arbitration documents attached to the US filing.
The KRG faces “enormous financial pressures,” due partly to its fight against Daesh militants and the cost of caring for refugees from the conflict, the region’s energy ministry said.
Dana Gas expects to be awarded damages and to learn the final amount the KRG will need to pay Pearl Petroleum in September, Chief Executive Officer Patrick Allman-Ward said on an earnings conference call earlier this month. Allman-Ward also said KRG authorities had asked Pearl Petroleum to resume development of fields there.
Pearl Petroleum’s biggest shareholders are Dana Gas and Crescent Petroleum, both based in Sharjah. Austria’s OMV AG, Hungarian energy group Mol Nyrt. and Germany’s RWE AG also have shares, according to the venture’s website.
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Dana Gas will seek shareholder approval to pay a dividend for 2017, it said on Sunday, in a move that could complicate its legal dispute with investors demanding that the company settles $700mn of Is
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26/03/2018
Gulf stock markets were generally little changed on Sunday, though Abu Dhabi’s Dana Gas surged on news of plans for its first annual dividend for several years.
The Abu Dhabi index rose 0.
The Gulf Today
Ticker | Price | Change |
---|---|---|
PETRORABIGH | 25.42 | 0.41 (1.63 |
BAHRI | 31.56 | -0.29 (-0.92 |
TAQA | 0.85 | 0.00 (0.00 |
ADNOCDIST | 2.64 | 0.07 (2.72 |
ALDREES | 26.08 | -0.31 (-1.18 |
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