Ascent Resources plc said it had received confirmation of its subsidiary’s entitlement to proceeds from all the wells in the Petišovci onshore gas joint venture in Slovenia.
RESOLUTION
The arbitration tribunal’s decision follows the hearing against the company’s partner Geoenergo.
Disagreement arose from the companies’ different interpretations of baseline production and the number of wells from which Ascent is entitled to receive a portion of revenues until it has recovered its investment of more than €50 million.
“The arbitration tribunal has now issued a binding interim decision which confirms that ASL [Ascent Slovenia Limited]’s interpretation of the RJOA [restated joint operating agreement] is the correct one,” said Ascent in a statement today.
“This confirms that, whilst ASL is in a preferential recovery position, ASL is entitled to a 90% share of the hydrocarbons produced above the baseline production profile from all of the wells on the concession area (except for the Pg-1 well which is included in the baseline production).
“This means that in addition to the PG-10 and PG-11A revenues the company has been receiving it will now also be entitled to receive on-going monthly revenues from incumbent wells, i.e. Pg-3, Pg-5, PG-6, Pg-7, Pg-9 (if it produces again) and the Dolina and Pt wells.”
The arbitration tribunal will now decide the final award in the second stage of the procedure expected to complete by 11 April 2024.
Ascent has proposed that the tribunal instruct Geoenergo to produce specific production and financial information for the exact quantum of the award for the proceeds to which ASL is entitled since December 2019.
The company estimates the proceeds, which Geoenergo has already received, are likely to be in excess of €3.5 million, subject to the tribunal’s determination.
Chief executive officer Andrew Dennan said: “We are very pleased to have received this multi million euro arbitration tribunal decision, which underlines what has been evident to the current Ascent team for some time and now and finally is being resolved formally and in a binding way.”