Tullow Oil liable for additional €43m over Ghana contract row
Tullow cancelled rig contract in 2016 after Ghana set drilling moratorium
A Tullow Oil drilling block in Kenya. Photograph: Getty Images
Irish explorer Tullow Oil has been found liable for $50.8 million (€43.7 million) of costs, in addition to a previous award against it of $140 million (€120 million), to settle a row over the termination of a contract in Ghana.
A panel of arbitrators, working under the jurisdiction of the International Chamber of Commerce, has delivered an award in favour of Kosmos Energy Ghana in relation to a dispute with a Tullow subsidiary.
Additionally, Tullow has to reimburse Kosmos for some of its legal and rig demobilisation costs.
Tullow cancelled the contract for the West Leo rig in December 2016 after Ghana set a drilling moratorium on its offshore oil and gas field in waters that were the subject of a dispute between Ghana and the Ivory Coast.
On July 3rd a court ruled that Tullow was not entitled to terminate the rig contract by invoking the contract’s force majeure provisions. Tullow expected to be required to pay about $140 million, although its total liability is now in excess of $190 million (€163 million).
Shares on Tullow’s London listing had fallen marginally in early morning trade with over 355,000 shares traded. No shares had been traded on its Irish listing in the first hour since the market opened.