MISC unit be­gins ar­bi­tra­tion against Sabah Shell

The Sun (Malaysia) - - SUNBIZ -

PETALING JAYA: MISC Bhd’s whol­ly­owned sub­sidiary Gu­musut-Kakap SemiFloat­ing Pro­duc­tion Sys­tem (L) Ltd (GKL) has com­menced ar­bi­tra­tion pro­ceed­ings against Sabah Shell Petroleum Co Ltd (SSPC), with claims of US$245 mil­lion (RM1.01 bil­lion).

In a fil­ing with Bursa Malaysia last Fri­day, MISC said GKL filed a no­tice of ad­ju­di­ca­tion dated Sept 23, 2016 un­der CIPAA 2012 and a no­tice of ar­bi­tra­tion dated Sept 2, 2016 with the Kuala Lumpur Re­gional Cen­tre for Ar­bi­tra­tion to be­gin ar­bi­tra­tion pro­ceed­ings against SSPC.

“The le­gal pro­ceed­ings were com­menced to seek res­o­lu­tion on con­trac­tual dis­putes cov­er­ing claims for out­stand­ing ad­di­tional lease rates, pay­ment for com­pleted vari­a­tion works and other as­so­ci­ated costs un­der the lease agree­ment dated Nov 9, 2012 en­tered into be­tween GKL and SSPC for the con­struc­tion and lease of the Gu­musutKakap Semi-Float­ing Pro­duc­tion Sys­tem (Semi-FPS) for the pur­poses of the pro­duc­tion of crude oil,” it said.

The le­gal pro­ceed­ings are not ex­pected to have any ma­te­rial im­pact on the earn­ings per share, gear­ing and net as­sets per share of MISC for the fi­nan­cial year end­ing Dec 31, 2016.

As ad­vised by GKL’s so­lic­i­tors, the com­pany is of the view that GKL has a good le­gal po­si­tion to suc­ceed in its claims against SSPC.

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