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RNS Number : 3444Y
Enwell Energy PLC
04 May 2023
4 May 2023
Enwell Energy plc
("Enwell" or the "Company")
Arkona - Successful Appeal in SC Licence Case
and Update on Regulatory Actions by Ukrainian Authorities
Enwell Energy plc (AIM: ENW), the AIM-quoted oil and gas
exploration and production group, announces a successful appeal
decision in the legal proceedings relating to its
Svystunivsko-Chervonolutskyi exploration licence (the "SC Licence")
in Ukraine, which is held by its subsidiary LLC Arkona Gas-Energy
("Arkona"), and an update on regulatory actions by Ukrainian
Authorities .
Arkona - SC Licence
Since the Company completed the acquisition of Arkona in March
2020 (see announcement dated 24 March 2020) , there have been a
number of legal challenges relating to the SC Licence. As announced
on 3 July 2020 , P JSC Ukrnafta ("Ukrnafta"), as claimant, brought
legal proceedings against Arkona, as defendant, in which Ukrnafta
made claims asserting that irregular procedures were followed in
the grant of the SC Licence to Arkona in May 2017. Ukrnafta also
brought these proceedings against the State Geologic and Subsoil
Survey of Ukraine (the "SGSS") . Both Arkona and the SGSS disputed
these claims. In these proceedings, the First Instance Court in
Ukraine made a ruling in favour of Ukrnafta, determining that the
grant of the SC Licence was irregular, and accordingly, the SC
Licence would be invalid. Arkona filed an appeal of this decision
in the Appellate Administrative Court in Kyiv, and on 29 September
2020, the Appellate Administrative Court ruled in favour of Arkona,
overturning the earlier decision of the First Instance Court.
Ukrnafta filed a further appeal in the Supreme Court in Kyiv, and
in February 2021, the Supreme Court ruled that the arguments raised
by Ukrnafta in the appeal were not substantiated, and that the
proceedings against Arkona should be dismissed. The decision of the
Supreme Court represented the final appeal procedure in respect of
these legal proceedings, and accordingly, these proceedings against
Arkona were exhausted.
Prior to the Company's acquisition of Arkona, Ukrnafta had
previously issued legal proceedings in 2018, raising substantially
the same claims, which proceeded through the First Instance Court
and Appellate Administrative Court, before a final appeal was
determined by the Supreme Court in October 2019, in which
Ukrnafta's claims were denied.
In April 2021, an entity named JV Boryslav Oil Company
("Boryslav"), which is 25.0999% owned by Ukrnafta, issued a further
legal claim, also claiming that irregular procedures were followed
in the grant of the SC Licence, which claim was denied by the First
Instance Court in July 2021 and by the Appellate Administrative
Court in October 2021. There was no further appeal in this case and
so the decision of the Appellate Administrative Court in these
legal proceedings is final.
In September 2021, Boryslav issued a further legal claim, again
claiming that irregular procedures were followed in the grant of
the SC Licence, against the SGSS, the State Commission of Ukraine
for Mineral Resources ("SCP") and Arkona, as defendants, with
Ukrnafta named as a third party. In this claim, the
First Instance Court made a ruling in January 2022 in favour of
Boryslav, and on 2 November 2022, the Appellate Administrative
Court also made a ruling in favour of Boryslav to uphold the
decision of the First Instance Court.
The Company appealed the decision of the Appellate
Administrative Court to the Supreme Court, and on 3 May 2023, the
Supreme Court published its decision to allow the Company's appeal
and overturn the ruling made by the Appellate Administrative Court.
The Supreme Court represents the final appellate court in these
legal proceedings, and accordingly, the decision of the Supreme
Court is final. Therefore, the SC Licence is valid.
The Company's announcements dated 24 March 2020, 3 July 2020, 31
July 2020, 30 September 2020, 23 November 2020, 11 February 2021
and 4 November 2022 provide additional information.
Regulatory Actions - UBO Registrations for Ukrainian Group
Subsidiaries
On 2 May 2023, the Ministry of Justice of Ukraine made Orders
(the "MoJ Orders") cancelling the registration entry made on behalf
of three Ukrainian subsidiaries of the Company named LLC
Prom-Enerho Produkt, LLC Arkona Gas-Energy and LLC Well Investum
respectively in the Unified State Register of Legal Entities,
Individuals-entrepreneurs and Civil Institutions of Ukraine
relating to the ultimate beneficial owners of such companies. The
registration entry for each of these companies stated the ultimate
beneficial owners to be the beneficial owners of the indirect
majority shareholder of the Company as notified to the Company and
published to the market on 26 January 2023, but the MoJ Orders
removed each such registration entry and restored the previous
entry in such Register, Vadym Novynskyi. As announced on 26 January
2023, the Company was notified that Vadym Novynskyi ceased holding
a beneficial interest in the indirect majority shareholder of the
Company on 1 December 2022. LLC Prom-Enerho Produkt holds the
Vasyschevskoye ("VAS") production licence, LLC Arkona Gas-Energy
holds the SC Licence and LLC Well Investum is a dormant company.
The Company is now consulting with its legal advisers to understand
the implications of these actions, and further information will be
announced in due course.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014, which forms part of United
Kingdom domestic law by virtue of the European Union (Withdrawal)
Act 2018, as amended by virtue of the Market Abuse (Amendment) (EU
Exit) Regulations 2019.
For further information, please contact:
Enwell Energy plc Tel: 020 3427
3550
Chris Hopkinson, Chairman
Sergii Glazunov, Chief Executive Officer
Bruce Burrows, Finance Director
Strand Hanson Limited Tel: 020 7409
3494
Rory Murphy / Matthew Chandler
Zeus Capital Limited Tel: 020 7614
5900
Alexandra Campbell-Harris (Corporate
Finance)
Simon Johnson (Corporate Broking)
Citigate Dewe Rogerson Tel: 020 7638
9571
Ellen Wilton
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