Last week the Commercial Court handed down judgment in the legal case brought by Leni Gas & Oil Plc and Leni Gas & Oil Investments Ltd (“LGO”) against MOG’s subsidiary Malta Oil Pty Limited. The judgment ruled that LGO’s case “failed at every stage”.
The Board of MOG has informed that, following a hearing today at the High Court, LGO was ordered to pay MOG’s legal costs on an indemnity basis.
LGO has already agreed to pay an initial £600,000 as an interim payment by 10 April 2014.
“It will take some time for the total costs payable by LGO to be agreed or assessed and MOG will keep shareholders informed of developments,” MOG said in a statement.
LGO applied to the judge for permission to appeal against the judgment handed down on 27 March 2014, and permission was refused. Any further application by LGO for permission to appeal has to be made to the Court of Appeal by 24 April 2014.
Keith Henry, Chairman of MOG, said: “MOG’s only objective throughout this process was to protect the interests of our shareholders. The court’s award of indemnity costs reflects the judge’s finding that LGO’s claim was “weak and thin” and it is therefore only right that LGO will have to reimburse substantially all of our legal costs.”
In a separate statement, LGO said it is now considering an application to the Court of Appeal in its action against Mediterranean Oil and Gas plc (“MOG”) over the July 2012 sale of its 10% interest in Malta Area 4.
Leni Gas & Oil (LGO), in July, 2012, sold its 10% share in the Malta Area 4 to MOG for 1$ for the interest plus $20,000 for its residual costs arising under the Joint Operating Agreement between the Parties associated with the acquisition of 3D seismic data in 2011.
Only weeks after the transaction, MOG entered into farm-in agreements with Genel Energy Plc, led by ex-BP CEO Tony Hayward, for a $10 million cash consideration and two well commitment on the offshore Malta Area 4 PSC.
LGO has taken legal action against MOG and has, since the farm-in deal, claimed it was tricked by MOG into selling its 10% share.
To remind, after buying Leni’s 10% interest in the PSC through its subsidiary Phoenicia Energy Company Limited (“PECL”) , MOG sold a 75% working interest in Phoenicia to Genel.
“Leni would not have sold its interest for $1 plus liabilities had it been aware of interest from Genel Energy or other potential farm-in partners,” Leni said in a statement last year.