Eni/Vitol Case: International tribunal dismisses $7 Billion claim against Ghana, GNPC – Attorney-General Reacts
The London Court of International Arbitration has rejected a $7 billion claim by Eni S.p.A. and Vitol against the Republic of Ghana and the Ghana National Petroleum Corporation (GNPC).
The claim was reviewed to $915 million in addition to interest at the end of the proceedings.
Eni proceeded to the tribunal challenging a breach of contract by the Government of Ghana (GoG) on its Sankofa oil field with that of Springfield’s Afina oil field.
Other decisions
In its ruling, the tribunal also dismissed the claimants’ claims against GNPC in totality. It also dismissed the request that the tribunal declare that Ghana breached the petroleum agreement by refusing to withdraw or prevent reliance by third parties on the unitisation directives.
Additionally, the tribunal dismissed the claimant’s request that Ghana notify the High Court, Court of Appeal and Supreme Court of Ghana that the unitisation directives were issued in breach of the petroleum agreement.
Unitisation Directives
However, the tribunal found that, the circumstances in which the unitisation directives were issued, breached the petroleum agreement. That is, the unitisation was contrary to the applicable regulations and thereby breached Article 26(2) of the petroleum agreement.
Ghana’s rights
The tribunal affirmed Ghana’s right to the authority to unitise oil fields to achieve efficient exploitation of the deposits. With regards to the allocation of fees and costs, the tribunal affirmed that since both parties had prevailed in some ways, they would be required to pay their own legal fees and costs.
A-G reacts
In a reaction to the award, the Attorney-General ( A-G) and Minister of Justice, Godfred Yeboah Dame, indicated that, although he would have wished the tribunal dismissed the claimants’ claims against Ghana in its entirety, he is satisfied that it rejected partly the claims against Ghana, and entirely the claims against GNPC.
In addition, he expressed delight with the complete dismissal of all claims for monetary compensation made by Eni/Vitol against Ghana, which has saved the country significant financial obligation.
Equally, he is delighted with the tribunal’s affirmation of Ghana’s sovereign right to unitise its oil fields.
Mr Dame indicated that following the development, the parties should determine the best way to proceed going forward, adding that unitisation, in principle, is not unlawful per the tribunal’s decision.
“It is the manner and the circumstances in which the same ought to be carried out that the tribunal found wanting in the current dispute,” he said.
Mr Dame said the A-G’s office is resolute in vigorously contesting all international arbitration claims calculated to impose judgment debt on the country.
