11th Apr 2014 09:10
LONDON (Alliance News) - Mediterranean Oil & Gas PLC said Friday it has received the first payment from Leni Gas & Oil PLC for litigation costs after Leni's dispute over the July 2012 sale of its 10% interest in Malta Area 4 was not upheld.
In March, Leni's fraudulent misrepresentation action against the company was not upheld by the High Court of England and Wales; the firms' argument was that Mediterranean misled it regarding the potential sale in July 2012.
Costs were awarded in favour of Mediterranean Oil & Gas on an indemnity basis in the March 27 hearing; Leni Oil and Gas was ordered to pay GBP600,000 to Mediterranean by April 10, with the remaining balance to be settled "in due course once agreed or assessed."
In a statement Friday, Mediterranean said Mr Justice Males had ruled that costs are being paid on an indemnity basis - allowing the firm to recover substantially all of its legal costs, it said - as Leni had pursued a "weak and thin" case, with allegations requiring full forensic enquiries leading to increased legal costs, and had courted publicity during the case in a way that was intended to raise the profile of the case.
Mediterranean said it has now received the first GBP600,000 from Leni as an interim payment towards its costs, which amount to more than GBP1.5 million. The firm said it will take some weeks for the final amount payable to be agreed or assessed.
The dispute dates back to July 31, 2012, when Leni Gas & Oil sold 10% of its interest in a Malta prospect license to Mediterranean Gas & Oil. Leni Gas & Oil argues that Mediterranean misled it regarding the potential sale in July 2012.
Last week Leni said that it was considering an appeal in the legal dispute, and noted that the settlement will not have any material impact on its ongoing oil production programmes in Trinidad and Spain as it was already provided for it its cash flow forecasts.
Shares in Mediterarnean Oil & Gas last traded at 5.375 pence per share; shares in Leni Gas & Oil were trading 4% lower at 0.72 pence per share Friday morning.
By Alice Attwood; [email protected]; @AliceAtAlliance
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