JKX Oil & Gas PLC Tribunal Award - Update (2713W)
08 February 2017 - 3:36AM
UK Regulatory
TIDMJKX
RNS Number : 2713W
JKX Oil & Gas PLC
07 February 2017
7 February 2017
JKX Oil & Gas plc
("JKX", the "Company" or the "Group")
Tribunal Award - Update
Yesterday, the international arbitration tribunal issued its
Award on the Company's claims against Ukraine. Beginning in 2015,
the Company had lodged several claims under the Agreement between
the United Kingdom and Ukraine for the Promotion and Reciprocal
Protection of Investments (the "UK-Ukraine BIT") for approximately
USD 168 million for excessive royalties and production taxes
("Rental Fees") paid by the Company's subsidiary Poltava Petroleum
Company plus damages.
The tribunal dismissed the main element of the Company's claim
for payment of excessive Rental Fees. The tribunal ruled that
Ukraine was found not to have violated its treaty obligations in
respect of excessive levying of such taxes, but awarded the Company
damages of approximately USD 11.8 million plus interest and costs
of USD 0.3 million in relation to subsidiary claims.
As previously reported, in parallel to the claims made against
Ukraine under the UK-Ukraine BIT, the Company has persistently
defended its position in the Ukrainian courts regarding the Rental
Fee charges levied for 2010 and 2015 (totalling approximately USD
32 million at current Hryvnia-USD exchange rates). Whilst this
ruling poses additional challenges for the Company in particular
regarding the 2015 claims (totalling USD 22.3 million at current
Hryvnia-USD exchange rates), the Company will continue to defend
its position in the Ukrainian courts in all outstanding cases. At
the same time, the Company intends to begin a dialogue with the
Government of Ukraine in order to satisfy the terms of the Award
and reach a mutually beneficial outcome.
Tom Reed, CEO of JKX, commented "JKX has, over many years, been
one of the largest foreign investors and major tax payers in the
Ukrainian gas industry. We are disappointed with the decision on
the overall award, but pleased that this result helps to draw a
line under historical legal issues. As set out in our strategy a
year ago, we now look forward to resolving all outstanding
litigation and returning to our core business of drilling for oil
and gas. We will call on the Ukrainian Government to secure support
in creating an environment in which JKX can execute its recently
finalised Field Development Plans, invest in gas production and
assist Ukraine to achieve energy independence."
This announcement contains inside information as defined in EU
Regulation No. 596/2014 and is in accordance with the Company's
obligations under Article 17 of that Regulation.
ENDS
JKX Oil & Gas plc +44 (0) 20 7323 4464
Russell Hoare, Chief Financial Officer
Stockdale Securities +44 (0) 20 7601 6100
Robert Finlay, Daniel Harris
EM Communications +44 (0) 20 3709 5711
Stuart Leasor, Jeroen van de Crommenacker
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCTRMFTMBJMBAR
(END) Dow Jones Newswires
February 07, 2017 11:36 ET (16:36 GMT)
Jkx Oil & Gas (LSE:JKX)
Historical Stock Chart
From Apr 2024 to May 2024
Jkx Oil & Gas (LSE:JKX)
Historical Stock Chart
From May 2023 to May 2024