Rockhopper Exploration plc said that the Italian Government had applied for an annulment of €190 million compensation for the company over the Ombrina Mare oil field dispute.
APPLICATION
In August the International Centre for Settlement of Investment Disputes (ICSID) arbitration held that Italy had breached its obligations under the Energy Charter Treaty.
Rockhopper added that on 28 October 2022, Italy submitted an application to the ICSID seeking to annul the award and a provisional stay of the enforcement of the award.
The company is consulting its legal representatives on how to contest the application.
FUNDING
Rockhopper said that third-party funding agreement did not cover any costs arising past the date of the award, 23 August 2022.
“Having anticipated Italy might attempt to annul the award, Rockhoppper has a non-binding offer in place to fund both fighting the annulment and enforcing the award if required.
“The company will now consider this along with other funding possibilities.
“A separate success fee of approximately £3 million is due to the company’s legal representatives on establishing liability and an award requiring Italy to pay over €25 million in damages.
“This amount is not covered by either funding agreement.
“The company is in productive discussions with its legal representatives as regards to this payment.”
PROCEEDINGS
Chief executive Samuel Moody added that the move by the Italian government was disappointing but not surprising.
“Based on legal advice we believe annulment proceedings are likely to take approximately 18 to 24 months, albeit interest will commence accruing again in December 2022.
“We remain confident in the strength of our case, as was reflected in the unanimous decision underpinning the award in August, and very much hope and believe the annulment request will be rejected in due course.”