GSPC wants Yemen cash back
GSPC has not lost hope of recovering its money from volatile Yemen, home to renegade Houthi militias wreaking havoc on international sea lanes.
At stake is $42m in Standby Letters of Credit (SBLCs) issued by the International Bank of Yemen and a $3.92m arbitration award favouring a GSPC-led consortium. A GSPC source tells us the company continues to chase Yemen authorities for the money.
In 2012-13, as gun battles raged between the Yemen army and rebel Houthi militias, GSPC and JV partners Western Drilling and Hyderabad-based Alkor Petroo recommended surrendering three onland blocks. On February 13 (2013), they terminated the PSAs for the 8424-sq km Block 19 (Al Jawf), the 4465-sq km Block 28 (North Balhaf) and the 10,963-sq km Block 57 (Al Rayan).
GSPC launched arbitration proceedings at the Paris-headquartered International Chamber of Commerce (ICC) to prevent the Yemen government from invoking the SBLCs. "We did this as the Yemen government directed us to extend the SBLC validity," we hear.
"We and the Yemen government filed detailed pleadings; a five-day final hearing was held from September 8 to 12 (2014) at the ICC hearing centre in Paris." On July 10 (2015), the tribunal declared that the GSPC consortium had validly terminated the three PSAs and also said the Yemen government was not entitled to draw on the related SLBCs.
Eventually, the tribunal awarded $3.92m costs to the GSPC consortium. However, Yemen challenged the award in the Court of Appeal, which on February 28 (2017) ruled for the GSPC consortium.
Despite GSPC launching enforcement action against the Houthi-controlled Yemen government, it admits it has "no option but to wait."