FAR in arbitration with ConocoPhillips over Senegal assets sale
Australian oil and gas company FAR Limited has started arbitration to resolve a dispute related to ConocoPhillips’ sale of interest in acreage off Senegal, which contains the SNE discovery, to Woodside.
The oil company informed on Tuesday it has made a request to the International Chamber of Commerce in Paris to start arbitration proceedings to resolve the current Joint Operating Agreement dispute regarding FAR’s right to pre-empt the sale of ConocoPhillips’ interest in the Rufisque, Sangomar and Sangomar Deep Joint Venture offshore Senegal.
Partners in the three exploration blocks containing the SNE discovery are Cairn Energy, as the operator with 40% interest, Petrosen, the Senegalese National Oil Company, with 10% interest, FAR, with 15% working interest, and Woodside, but not according to FAR, with 35%.
Namely, FAR has previously objected the 2016 sale of ConocoPhillips‘ 35 percent interest to Australia’s Woodside, claiming the completion of the transaction between ConocoPhillips and Woodside was subject to the rights of partners to pre-empt and Senegal Government approval.
According to FAR, a valid pre-emptive rights notice had not been issued to the JV partners by ConocoPhillips and FAR has invoked its right to resolve this dispute in accordance with the Joint Operating Agreement. Therefore, FAR has been thinking of arbitration against ConocoPhillips since last March.
In the meantime, Woodside made plans to become the operator of the project, taking over from Cairn, before the Final Investment Decision is made. As expected, this has also been challenged by FAR.
SNE development at risk?
Earlier this month, Woodside accused FAR of putting the SNE development at risk due to its refusal to support arrangements for Woodside to undertake development works as a development lead of the SNE oil field. Woodside also said that FAR’s actions were putting at risk the timely development of the SNE oil field.
FAR, on the other hand, noted its support to the approved joint venture work program and budget and development schedule as presented by the operator and brought to attention its promotion of an accelerated development schedule to the joint venture.
Offshore Energy Today Staff