MISC unit begins arbitration against Sabah Shell
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.