LONDON, December 16, 2013 /PRNewswire/ --
Mr Jack J. Grynberg, President and CEO of RSM Production Corporation (RSM), has won against Victoria Oil and Gas PLC (VOG) regarding VOG's asserted ownership of rights in the Logbaba Concession in Cameroon. On November 30, 2013 a unanimous International Chamber of Commerce (ICC) Arbitration Panel affirmed RSM's 40% interest in Logbaba.
He said today:
"This is a significant victory for RSM and vindicates our long held position. The Board of Victoria Oil and Gas has repeatedly made inaccurate and incomplete claims concerning the ownership of their major asset, which is a hydrocarbon concession in the Cameroon. As I have pointed out before, their claim that they owned a "95% working interest" in the Logbaba Concession was false and has resulted in protracted, expensive and unnecessary arbitration on account of Victoria Oil and Gas. This has now ended with a unanimous finding that RSM owns 40% of the Logbaba Project, along with certain other incidental rights. The arbitration also confirmed that RSM owns 100% of the Logbaba No. 101 and No. 103 wells and VOG has 0% in these two (2) bypassed natural gas condensate wells.
"As President and Chief Executive of RSM I have been involved in the Logbaba Concession since it was initially granted to RSM in May 2001. I intend to review all strategic decisions that have been made unilaterally by VOG without regard to RSM's rights in the project. Going forward, RSM will be actively involved in the management and operation of all commercial projects in respect of the Concession and I will continue to take such steps as are necessary to protect its interests."
RSM has written to VOG requiring an audit of its project management and requiring that it now pays to RSM its overriding royalty on gross production estimated by RSM to be $510,000.
Meanwhile, RSM's International Centre for Settlement of Investment Disputes (ICSID) case against the Republic of Cameroon is proceeding to arbitration. RSM's claim is for declaration, rescission and damages on the basis that VOG and Cameroon made unilateral detrimental concessions on gas price and licence area without the authority and agreement of RSM. The case was registered on 1 July 2013 and a first hearing is expected early in 2014.
Notes to Editors:
- Jack J. Grynberg is the President and CEO of RSM Production Corporation. He is an eminent and highly experienced expert in the fields of hydrocarbon research, exploration, development and production. He has been resolute and highly successful in defending his and his family's companies' interests where necessary through negotiation, arbitration and other litigation.
- RSM Production Corporation (RSM) operates as an oil and gas exploration and production company. The company was incorporated in 1996 and is based in Denver, Colorado. RSM owns a 40% interest in the Logbaba Concession.
- Victoria Oil and Gas plc (VOG) is an AIM listed oil and gas exploration and production company with assets in Africa and the FSU. The company's principal assets are the Logbaba gas and condensate project in Cameroon and the West Medvezhye project in Siberia, Russia. VOG Chairman is Kevin Foo.
- The Logbaba Concession was granted to RSM by the Republic of Cameroon on 31 May 2001. On 9 August 2006 RSM assigned an interest to a VOG subsidiary, which was approved by Cameroonian Presidential Decree on 29 November 2006. It is a matter of contention as to whether the assignment was of a 50 per cent interest or a 60 per cent interest in the Concession. In 18 July 2011, VOG asserted that pursuant to the provisions of an operating agreement between the parties, RSM had forfeited to VOG its remaining interest. This assertion is disputed and is subject of ongoing and protracted Arbitration between the parties.
- In July, 2011, VOG refused to accept RSM's payment of an outstanding $4,100,000 forcing RSM to demand arbitration. RSM rejected VOG's claims that RSM had forfeited its interest in the Logbaba Development and the Government of Cameroon has not approved the transfer of RSM's remaining interest in the Logbaba Development to VOG. A Republic of Cameroon Presidential Decree executed on 3 December 2012 confirms RSM's interest.
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SOURCE RSM Production Corporation (RSM)