Perth company FAR Ltd. has moved to arbitration to resolve the current joint operating agreement dispute regarding the company’s right to pre-empt the sale of ConocoPhillips’ interest in three blocks, including one containing the recent SNE oil discovery offshore Senegal (OGJ Online, June 8, 2017).
FAR made its request on June 20 to the International Chamber of Commerce in Paris to commence the arbitration proceedings.
Fellow Perth company Woodside Petroleum Ltd. has confirmed the move but believes that FAR’s claim has no merit.
Woodside bought a 35% stake in the Rufisque, Sangomar, and Sangomar Deep joint ventures from ConocoPhillips for $350 million last year, but FAR maintains that a valid pre-emptive rights notice had not been issued to the JV partners by ConocoPhillips.
In response to this assertion, Woodside on June 21 released a statement saying that the Republic of Senegal’s Minister of Energy and the Development of Renewable Energy has issued a Ministerial Order that provides further confirmation of Woodside’s participation in the three Senegal blocks.
As arbitration proceedings have now been initiated, Woodside does not intend to make any further comment at this stage.
The SNE project has been scheduled to come on stream as early as 2021. It will be Senegal’s first oil development, but it now faces delays because of the dispute.
As part of the deal to buy into the region, Woodside has also made plans to become operator of the SNE development, taking over from Cairn Energy PLC before a final investment decision is made. This too has been challenged by FAR.