Crescent Petroleum and Dana Gas have sold shares in Hungary's MOL Group, their partner in the Pearl consortium operating in northern Iraqi region of Kurdistan, and started arbitration proceedings over the recent settlement with the Kurdistan Regional government (KRG).
“Unfortunately, MOL unreasonably sought to link its endorsement of the settlement to a renegotiation of the terms by which it first secured its participation in Pearl back in May 2009,” Dana Gas said in a filing on the Abu Dhabi bourse. “And now [MOL] complains about Dana Gas and Crescent Petroleum for their handling of the settlement alongside Pearl, expressing dissatisfaction with the outcome as compared to the alternative of pursuing a final litigation and enforcement outcome against the KRG.”
Crescent and Dana Gas have sold their combined 6 per cent shareholding in the Hungarian firm and filed arbitration proceedings in London.
MOL was not immediately available for comment when contacted by The National.
The KRG agreed last month to immediately pay US$1 billion to the Pearl consortium that includes Crescent and Dana Gas, after four years of legal battles. KRG said it would pay the consortium $600 million with a $400m payment to be put toward the consortium’s future investment in Kurdistan’s gas fields.
“The settlement agreement with the KRG was welcomed and endorsed by Dana Gas, Crescent Petroleum, OMV and RWE, together holding 90% of the shares of Pearl,” Dana Gas said.
The KRG settlement is needed for the companies to restart investments in the region for the development of the Khor Mor and Chemchemal fields.