19th Nov 2019 11:22
(Alliance News) - Nostra Terra Oil & Gas Co PLC on Tuesday said its subsidiary Nostra Terra Inc has reached a conditional agreement with regards to the East Ghazalat Concession, Egypt.
In mid-August, the London Court of International Arbitration Tribunal published its award in relation to the East Ghazalat concession, in which Nostra Terra Inc holds a 50% interest, with North Petroleum International Co SA holding the reminder.
The East Ghazalat asset is considered non-core to Nostra Terra, which is focused on the Permian Basin, and East Texas, US.
The Tribunal has found that Nostra Terra Inc is in default of the joint operating agreement for the non-payment of the November and December 2015 cash calls to North Petroleum, amounting to USD1.1 million plus interest.
On Tuesday, Nostra Terra said its subsidiary has agreed to transfer its 50% stake in East Ghazalat to North Petroleum to conclude the arbitration, with no further cash calls or liabilities for any past losses.
"Following the arbitration Nostra Terra Inc had the option to pay past cash calls and continue with the asset. However, we have taken the view that because the asset is loss-making and given we are not the operator, despite the fact that we feel that we could improve operations significantly, ultimately the best resolution is for Nostra Terra Inc to transfer its interest and have no past or future liability," explained Chief Executive Matt Lofgran.
Nostra Terra shares were trading 8.0% lower in London on Tuesday at 1.10 pence each.
By Evelina Grecenko; [email protected]
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