The London Court of International Arbitration has ruled in favour of Sharjah-based Dana Gas, validating the termination of an agreement to sell its onshore oil and gas assets in Egypt.
The arbitration was initiated in April by IPR Wastani Petroleum, a member of the IPR Energy Group which had agreed to buy the assets in October.
However, Dana Gas cancelled the agreement in April saying the buyer had failed to meet certain conditions. A claim brought by IPR Wastani was rejected “in its entirety”, Dana Gas said in a statement on Sunday to the Abu Dhabi Securities Exchange, where its shares are traded.
The tribunal ruled in favour of Dana Gas on “all key points, concluding that Dana Gas’ termination of the SPA was valid”, the company said.
Dana Gas, the Middle East's largest private natural gas company, cancelled the $236 million deal on April 22. The ruling in its favour today means that the UAE energy company will continue to operate the Egyptian assets.
“The award confirms that Dana Gas was correct and within its contractual rights to terminate the sale’s process,” said Patrick Allman-Ward, chief executive of Dana Gas.
“The board has made a decision to continue to hold and operate the assets in the best interests of the company and its shareholders as well as for our broader stakeholders.”
The planned sale transaction involved spinning off Dana Gas’ 100 per cent working interests in the El Manzala, West El Manzala, West El Qantara and North El Salhiya onshore concessions and associated development leases. The deal also included a base cash consideration of $153m, including the net working capital associated with the assets and contingent payments of up to $83m, Dana Gas said in October last year.
The effect of the cancellation of the sale on Dana Gas's finances is still being assessed but can only be "positive" in terms of cash flows, Mr Allman-Ward said in April.
Dana Gas is “pleased with the outcome of this arbitration and with the speed with which this final decision was made”, he said on Sunday.
He said that the company remains committed to operating the assets to the “highest operational and safety standards”.
Dana Gas, which also has operations in Iraq’s Kurdistan region, has been operating in Egypt for the past 14 years and is the fifth-largest gas producer in the country. It currently produces about 30,000 barrels of oil per day from 14 development leases.
The company said it is committed to maximising the value of its onshore producing assets while maintaining focus on testing the enormous potential of its offshore Block 6 Concession Area, which is estimated to contain more than 20 trillion cubic feet of gas.
It plans to drill an exploration well at Block 6 in the first quarter of 2022, depending on the availability of long lead items.
The award confirms that Dana Gas was correct and within its contractual rights to terminate the sale's process
Patrick Allman-Ward,
chief executive, Dana Gas
Dana Gas Egypt received payments of $98 million in the first half of the 2021, a 128 per cent rise from a year earlier. It collected $23m in the first three months of the year and the remaining amounts in the second quarter, it said on Sunday.
The company expects its receivables of $131m at the end of the first quarter to drop "significantly" and for its Egyptian operations to contribute positively towards profitability and cash flow in the second quarter.
"A portion of impairments, which the company recognised in 2020, will also be reversed in [the second] quarter [of] 2021 as a result of retaining these assets," the company said.
Dana Gas' overall payments from both Egyptian and Kurdish operations jumped 106 per cent in the first half of 2021 to $185m, the highest in five years, it said in a statement earlier this month.
In May, Dana Gas reported a 41 per cent increase in its first quarter net income to $24m. Higher revenue from its assets in Kurdistan boosted profit, it said in a statement at the time.
Results
6.30pm: The Madjani Stakes (PA) Group 3 Dh175,000 (Dirt) 1,900m
Winner: Aatebat Al Khalediah, Fernando Jara (jockey), Ali Rashid Al Raihe (trainer).
7.05pm: Maiden (TB) Dh165,000 (D) 1,400m
Winner: Down On Da Bayou, Royston Ffrench, Salem bin Ghadayer.
7.40pm: Maiden (TB) Dh165,000 (D) 1,600m
Winner: Dubai Avenue, Fernando Jara, Ali Rashid Al Raihe.
8.15pm: Handicap (TB) Dh190,000 (D) 1,200m
Winner: My Catch, Pat Dobbs, Doug Watson.
8.50pm: Dubai Creek Mile (TB) Listed Dh265,000 (D) 1,600m
Winner: Secret Ambition, Tadhg O’Shea, Satish Seemar.
9.25pm: Handicap (TB) Dh190,000 (D) 1,600m
Winner: Golden Goal, Pat Dobbs, Doug Watson.
THE LIGHT
Director: Tom Tykwer
Starring: Tala Al Deen, Nicolette Krebitz, Lars Eidinger
Rating: 3/5
Citizenship-by-investment programmes
United Kingdom
The UK offers three programmes for residency. The UK Overseas Business Representative Visa lets you open an overseas branch office of your existing company in the country at no extra investment. For the UK Tier 1 Innovator Visa, you are required to invest £50,000 (Dh238,000) into a business. You can also get a UK Tier 1 Investor Visa if you invest £2 million, £5m or £10m (the higher the investment, the sooner you obtain your permanent residency).
All UK residency visas get approved in 90 to 120 days and are valid for 3 years. After 3 years, the applicant can apply for extension of another 2 years. Once they have lived in the UK for a minimum of 6 months every year, they are eligible to apply for permanent residency (called Indefinite Leave to Remain). After one year of ILR, the applicant can apply for UK passport.
The Caribbean
Depending on the country, the investment amount starts from $100,000 (Dh367,250) and can go up to $400,000 in real estate. From the date of purchase, it will take between four to five months to receive a passport.
Portugal
The investment amount ranges from €350,000 to €500,000 (Dh1.5m to Dh2.16m) in real estate. From the date of purchase, it will take a maximum of six months to receive a Golden Visa. Applicants can apply for permanent residency after five years and Portuguese citizenship after six years.
“Among European countries with residency programmes, Portugal has been the most popular because it offers the most cost-effective programme to eventually acquire citizenship of the European Union without ever residing in Portugal,” states Veronica Cotdemiey of Citizenship Invest.
Greece
The real estate investment threshold to acquire residency for Greece is €250,000, making it the cheapest real estate residency visa scheme in Europe. You can apply for residency in four months and citizenship after seven years.
Spain
The real estate investment threshold to acquire residency for Spain is €500,000. You can apply for permanent residency after five years and citizenship after 10 years. It is not necessary to live in Spain to retain and renew the residency visa permit.
Cyprus
Cyprus offers the quickest route to citizenship of a European country in only six months. An investment of €2m in real estate is required, making it the highest priced programme in Europe.
Malta
The Malta citizenship by investment programme is lengthy and investors are required to contribute sums as donations to the Maltese government. The applicant must either contribute at least €650,000 to the National Development & Social Fund. Spouses and children are required to contribute €25,000; unmarried children between 18 and 25 and dependent parents must contribute €50,000 each.
The second step is to make an investment in property of at least €350,000 or enter a property rental contract for at least €16,000 per annum for five years. The third step is to invest at least €150,000 in bonds or shares approved by the Maltese government to be kept for at least five years.
Candidates must commit to a minimum physical presence in Malta before citizenship is granted. While you get residency in two months, you can apply for citizenship after a year.
Egypt
A one-year residency permit can be bought if you purchase property in Egypt worth $100,000. A three-year residency is available for those who invest $200,000 in property, and five years for those who purchase property worth $400,000.
Source: Citizenship Invest and Aqua Properties
