11/13/2020 | Press release | Distributed by Public on 11/13/2020 05:19
EFORA ENERGY LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1993/000460/06)
JSE Share Code: EEL
('Efora' or 'the Company')
EFORA AND TRANSCORP SETTLE LEGAL DISPUTES ON OPL 281
Shareholders are referred to the Litigation Update section of the Company's Condensed Provisional Consolidated Reviewed Results released on 31 August 2020, wherein the Company provided an update on the litigation process between the Company, through its subsidiary SacOil 281 Nigeria Limited ('SacOil 281'), EER 281 Nigeria Limited ('EER 281') and Transnational Corporation of Nigeria PLC ('Transcorp').
Efora and Transcorp have been in discussions over the last few months to resolve the ongoing dispute and litigation that commenced in December 2014 in connection with OPL 281. Both parties reached an amicable settlement under which they agreed to forgo their respective claims against each other and discontinue all pending lawsuits and arbitration in connection with OPL 281 ('Settlement Proposal').
The Boards of both parties, together with their advisors, evaluated the Settlement Proposal and concluded that it would be in their best interest to enter into the settlement agreement ('Agreement'), under which Transcorp will pay Efora a total amount of US$5.5 million as full and final settlement of all claims within a period of 13 months from the signature date, with $500,000 being due within 10 business days of signing the settlement agreement.
Efora has the right to reinstate the arbitration process for the full amount claimed, in the event that Transcorp fails to pay any amounts under the Agreement as they become due and payable.
Efora's CEO, Damain Matroos said:
'I am pleased to have brought this matter to a close during these challenging economic times and this removes one more legacy issue for the Group. The conclusion of this matter and the receipt of these funds would also allow the Group to allocate more resources to invest in new initiatives to generate value for our shareholders.'
Commenting on the agreement, President/CEO of Transcorp, Owen Omogiafo, stated
'I am glad that the mutual understanding that resulted in our partnership at inception, has brought about this win-win resolution with great potential for future cooperation. On our part, this agreement provides a pathway that takes away the legal constraints to the development of the asset going forward.'
13 November 2020
For further information please contact:
Efora Energy Limited
+27 (0)10 591 2260
Efora Energy Limited is a South African based independent African oil and gas company, listed on the JSE. The Company has a diverse portfolio of assets spanning production in Egypt; exploration and appraisal in the Democratic Republic of Congo; a midstream project relating to crude trading in Nigeria and material downstream distribution operations throughout Southern Africa. Our focus as a Group is on delivering energy for the African continent by using Africa's own resources to meet the significant growth in demand expected over the next decade.