Dateline Report
ISLAMABAD: Petroleum Exploration (Pvt) Ltd (PEL), a Pakistani oil firm, has won a legal battle against Bermuda-based company Frontier Holdings Ltd (FHL) at the International Court of Arbitration. The court ruled that Pakistani laws govern the Petroleum Concession Agreements (PCAs) signed in the country.
The arbitration court, consisting of a tribunal, ruled by a majority that it did not have jurisdiction over the dispute and ordered FHL to bear the arbitration costs, which were set at $250,000.
FHL, a subsidiary of Canadian company Jura Energy Corporation, initiated the legal battle following a dispute with local partner PEL regarding their joint ventures in the Badin North and Badin South blocks, in which FHL holds a 27.5% share.
The blocks were awarded in 2006 by the Ministry of Petroleum. PEL claimed that the international arbitration was intended to obstruct oil and gas exploration and production (E&P) activities in Pakistan.
PEL officials also stated that companies like FHL function as non-operators in the E&P sector and have defaulted on their financial obligations towards the Pakistani government and key industry players such as OGDCL and Mari Petroleum.
