12th May 2015 11:10
LONDON (Alliance News) - President Energy PLC said the dispute with its partner on the Pirity concession in Paraguay has been "amicably resolved".
At the beginning of March, President said it had been informed Petro-Victory, which holds a 36% interest in the Pirity concession, had delivered a notice of audit to President over "concerns" about cash demands from President that were "in excess of the approved work programme" in 2013 and 2014.
Further, Petro-Victory said President also was responsible for "over-expenditures and inadequate logging and well testing" on the concession.
As a result of that, Petro-Victory said it would seek injunctive relief barring President from some actions relating to the concession, including prohibiting President's ability to enter into any contracts or agreements relating to the concession.
However, President claimed it was unaware that Petro-Victory had taken court action and said it received no notice of the problems. In addition, President retaliated by claiming Petro-Victory had defaulted under the joint operating agreement after failing to pay its agreed contribution, claiming Petro-Victory had USD1.8 million of outstanding fees owed for the work programme.
Because President believed Petro-Victory had defaulted, it said it had the right to acquire Petro-Victory's interest in the concession at a discounted value as per the terms of the agreement.
On Tuesday, both companies appeared to have withdrawn their allegations and claims after they released a joint statement that said the dispute had been "amicably resolved", and that they are both focused on "unlocking the value" in Paraguay.
President shares were up 1.7% to 11.95 pence per share Tuesday midday.
By Joshua Warner; [email protected]; @JoshAlliance
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