Page 11 - AfrOil Week 14 2021

AfrOil PERFORMANCE AfrOil

Wood Mackenzie anticipates a strong recov- Saudi Arabia will push for more restraint, as
ery in US oil demand by the third quarter, with its economy and state budget are far more reliant
global demand rising 6.2mn bpd year on year on oil revenues, with the kingdom’s fiscal break-
in 2021. even point estimated at $76 per barrel in 2020.
Negotiations between OPEC+’s lead mem- Russia, meanwhile, needs only just over $40 per
bers Russia and Saudi Arabia going forward are barrel to balance the books over the coming
likely to play out in similar fashion as they have years, and will therefore be better positioned to
done. play hardball in talks. ™

PROJECTS & COMPANIES
PetroNor to restart arbitration process

in dispute over offshore ROP, SOSP fields

SENEGAL OSLO-LISTED PetroNor has announced plans
to restart the arbitration process in its dispute
with the government of Senegal over two off-
shore blocks, Senegal Offshore Sud Profond
(SOSP) and Rufisque Offshore Profond (ROP).
In a statement dated April 5, PetroNor said it
was taking this step because it had not been able
to strike an agreement with Senegalese author-
ities over the last year. The two sides agreed to
suspend formal arbitration under the Inter-
national Centre for Settlement of Investment
Disputes (ICSID) in May 2020 in the hope of
coming to terms independently and have been
working diligently towards this end. Neverthe-
less, the parties have been “unable to reach a sat-
isfactory solution,” the statement said.
Eyas Alhomouz, PetroNor’s chairman, PetroNor and Dakar have been at odds over the blocks since 2017 (Image: PetroNor)
expressed disappointment, saying: “We had
hoped for a different outcome, given our proac- production-sharing contracts (PSCs) for SOSP
tive and flexible efforts and the progress of dis- and ROP expired, and African Petroleum Corp.
cussions in recent months that would have seen (APC), which is now a subsidiary of PetroNor,
a deal that preserved the value for the people of applied for permission to participate in the
Senegal. However, we have not been able to find second renewal phase of work at the blocks. It
middle ground.” also asked PetroSen, the national oil company
He continued: “We have had an extensive (NOC) of Senegal, to let it commit to collecting
dialogue with and support from [Senegalese 3D seismic data rather than drilling new wells.
President Macky Sall’s] office and the Ministry However, its applications were rejected.
[of Petroleum and Energy]. However, as the Subsequently, APC filed a formal notice of
Senegalese party has not been able to move the dispute with the government in January 2018. In
dialogue forward, the process is now to return the notice, it alleged that Senegalese authorities
to arbitration.” had not taken the steps necessary to validate the
According to Alhomouz, talks between the termination of the contracts. The parties were
parties have been affected by the coronavirus unable to resolve the dispute within a period of
(COVID-19) pandemic and personnel changes three months, and APC sought arbitration from
within the Senegalese government over the last ICSID in August 2018.
year. The dispute flared up again in November
“Negotiations have undoubtedly been ham- 2019, several months after PetroNor completed
pered by a number of factors, including the its acquisition of APC. It stemmed from Dakar’s
inability to travel to Dakar as a result of the decision to include SOSP in a licensing round
pandemic and ministerial changes throughout that covered all of the country’s open offshore
negotiations,” he was quoted as saying in the blocks.
company’s statement. PetroNor responded to this move by declar-
PetroNor and Dakar have been at odds over ing that its subsidiary had not relinquished its
the two blocks since late 2017. At that time, the claims to that block or to ROP. ™

Week 14 07•April•2021 www. NEWSBASE .com P11