Ascent Resources plc has settled part of its revenue claim against joint venture (JV) partner Geoenergo, and agreed full settlement in the dispute with JV service provider Petrol Geo, over onshore gas interests in Slovenia.
PETROL GEO
Mediation between the companies resulted in a settlement of €1,436,000, at a 30% discount to the face value, for Petrol Geo’s claims against the JV over disputed and rejected invoices from 2019 to February 2023.
The JV has also successfully renegotiated a reduction in the field operating service provider’s fixed fee to the higher of €20,000 per month, or 35% of Ascent’s share of the hydrocarbons produced from the PG-10 and PG-11A wells.
The previous fee was a fixed €44,000 per month, which was unstainable when the gas prices were lower and production levels were lower, said the company.
Ascent added that the renegotiated fee level increased the profitability of the remaining production before the concession expires on 28 November 2023.
GEOENERGO
The company has also settled part of its claims against its partner, Geoenergo over non-payment of agreed hydrocarbon revenues owed to Ascent from January 2022 to February 2023, currently totalling €1,724,689 plus interest.
Geoenergo has agreed to pay the revenues in full, minus Petrol Geo’s agreed payment, leaving Ascent immediate further net revenues of €288,689 in cash.
This is in addition to €857,000 revenue already received by Ascent last August relating to 2020 and 2021 PG-10 and PG-11A production volumes.
Ascent continues to pursue its arbitration claim against Geoenergo in relation to the baseline production profile and the number of wells to receive a portion of revenues while it is in a preferential cost recovery position (until it has earnt back its investment of over €50m).
The company expects the tribunal’s final hearing to be in July 2023.
Ascent is seeking compensation of at least €3 million for its share of hydrocarbons produced above the baseline production profile for producing wells, other than PG-10 and PG-11A.
ENERGY CHARTER TREATY DAMAGES
The company added that the tribunal has been constituted for its ICSID* registered €500+ million damages claim against the Republic of Slovenia for breach of the Energy Charter Treaty.
The first procedural hearing is due in April 2023.
PROGRESS
Chief executive Andrew Dennan said that the company was pleased to continue making progress in achieving resolutions to the various disputes.
“Whilst there is still a way to go, resolving the matter with the service provider has resulted in a significant retrospective cost saving alongside a re-profiled and more sustainable ongoing project cost base for our Slovenian asset.”
*International Centre for Settlement of Investment Disputes
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