Financial compensation: Ivorian company points the finger at MRS Oil Nig. Plc for disobeying order of arbitration tribunal

The lingering crisis between Societe Nationale Petroliere de Cote D’Ivoire (PETROCI) – Ivorian state oil company equivalent to NNPC – and MRS Oil Nig. Plc, has taken a new dimension with the former accusing MRS of disregarding the judgment of arbitration tribunal that sat over dispute which arose from a business deal.

PETROCI said despite the tribunal’s judgment which ordered MRS to pay it certain amount of money running into millions of dollars, MRS has yet to abide by the judgment.

PETROCI had accused MRS of fleecing it of dividends and profit from the deal which saw both of the companies acquiring the controlling shares of Chevron Texaco downstream distribution assets in West Africa.

PETROCI also said that MRS had excluded it from management of joint venture both companies had stake in.

According to PETROCI, the dispute nudged both of them to Court of Arbitration of Paris, where it demanded for compensation from MRS for financial damages arising from exclusion, among other claims.

Upon filing of the parties’ closing submissions, the arbitral tribunal comprising Prof. Dr Maxi Scherer, Dr Hami Gharavi and Mr Michael Young QC after hearing the parties on the issues in contention delivered its final award on the 24th day of March 2021, in the ICC Case No. 23221/DDA (c-23222/DDA).

The arbitral tribunal in its final award contained at Page 271, orderd that MRS to call a general meeting of all entities within 30 days of the award for the termination of the mandate of current directors and appointment of new board members, with each party having the power to appoint equal numbers of directors.

The tribunal further ordered that the sum of US$25,496,56 is to be paid to PETROCI by MRS with 10% interest from December 31, 2018, while PETROCI is to pay the sum of US$34,029,629 to MRS with 10% interest from November 14 2017, as acquisition costs.

However, PETROCI said it found that there was error in computing the amount to be paid to MRS.

“During PETROCI’s review of the final award, the PETROCI noted that the arbitral tribunal had made an error in the computation of the acquisition costs payable by it to MRS, which error unwittingly had put PETROCI in a debit position on a net basis. Consequent to the above, the PETROCI applied to the arbitral tribunal for the rectification of the arbitral award dated the 24th of March 2021, to which the tribunal vide an addendum acknowledged the error made and rectified the erring paragraph in relation to the financial aspect of the award.

“By the said addendum, the PETROCI is to pay MRS the sum of USD 14, 413,697.50 as the unpaid balance of its 50% of the acquisition costs as opposed to the sum of USD 34,029,629 wrongly calculated in the final award. Consequently, a deduction of the amount due from PETROCI under the addendum from the amount due from MRS under the Final award stands at the sum of USD11,082,862.5 in favour of PETROCI,” the Ivorian company alleged.

According to PETROCI, despite the above demand on the financial award in the addendum, and the earlier demand in relation to implementation of the recognition of its 50% shareholder right with resulting shareholders meeting to restructure all the boards of the subsidiaries, MRS has failed and or neglected to comply with the decision of the tribunal as contained in the final award and its addendum both dated 24th day of March 2021 and 21st day of June 2021 respectively.

The company also complained that MRS shut its representatives out of the general annual meeting held in Lagos recently.

PETROCI is thus calling out MRS Holdings, belonging to Sayyu Dantata, to obey orders of the court.