GSPC ignores GeoGlobal

Vol 14, PW 5 (26 Aug 10) News in Brief

GSPC seems to be ignoring the third draft of a proposal by Canada’s GeoGlobal Resources to resolve their $150m ‘carried interest’ dispute at the Deen Dayal discovery block KG-OSN-2001/3.

PETROWATCH learns GeoGlobal sent this latest draft to GSPC sometime in July. “But it has received no response yet,” says an industry source.

GeoGlobal, he adds, sent similar proposals to GSPC in June this year and December last year (2009). But while GeoGlobal hopes for an amicable compromise with GSPC, we hear, it is also leaving nothing to chance and has ‘retained’ top Indian lawyer Harish Salve should the dispute worsen.

Salve has examined the Carried Interest Agreement signed on August 7, 2003 between the two companies and he believes GeoGlobal owes GSPC nothing for exploration costs at Deen Dayal until first commercial production begins. GSPC (80%) operates block KG-OSN-2001/3 with GeoGlobal (10%) and Jubilant (10%).