Spanish Gas Co. And Egypt Settle $2B Award Suit - LAW360

March 16, 2021, 10:03 PM EDT

Diamond Naga Siu 

A Spanish gas company has agreed to drop its $2 billion award confirmation suit against Egypt in D.C. federal court after the parties inked a settlement ending their years' long dispute over Egypt cutting off a natural gas plant's supply.

The International Centre for Settlement of Investment Disputes issued Unión Fenosa Gas SA the award against the Arab Republic of Egypt after finding that the state-owned gas company breached a contract by cutting off UFG's gas supply to its liquefied natural gas plant in Damietta.

U.S. District Judge James E. Boasberg on Tuesday accepted UFG and Egypt's Monday joint stipulation of dismissal, which said each party would handle its own attorney fees and costs. The settlement was agreed upon in early December.

"We and our client are very pleased that, after nearly eight years of arbitration in which UFG obtained notable results, the parties were able to reach a settlement that resolves all remaining disputes and allows UFG to recover damages for the breaches that precipitated the dispute," James E. Berger of King & Spalding LLP, counsel for UFG, told Law360 in an email Tuesday.

Egypt announces settling of claims over restarted Damietta LNG plant - REUTERS

WED MAR 10, 2021 / 2:48 AM EST

(Reuters) - Egypt's petroleum ministry announced on Wednesday a series of agreements settling all claims between Egypt, Egyptian National Gas Holding Company (EGAS), Union Fenosa Gas and the Spanish Egyptian Gas Company (SEGAS), ensuring resumption of production at the Damietta LNG liquefaction plant.

Last month, Egypt's petroleum minister had announced the restarting of the plant, which is 50% owned by Eni, a key step in the country's plans to promote itself as an energy hub in the eastern Mediterranean.

Breakdown in Naturgy, Eni and EGPC Damietta dispute resolution - ENTERPRISE

Sunday, 26 April 2020

DISPUTE WATCH- The resolution of a long-simmering dispute over a shuttered Damietta LNG plant has fallen apart despite an agreement reached last month, according to a cabinet statement. Parties to the dispute include Spanish gas firm Naturgy Energy Group, Italy’s Eni, and the Egyptian government.

Why does this matter? First, the dispute was closely followed by investors in Egypt’s energy sector, though that concern was largely swept away as the Sisi administration reached a settlement with all parties. More importantly, the Damietta plant is a key part of Egypt’s strategy to grow its natural gas exports as it emerges as the Eastern Mediterranean’s premier energy hub. The plant has been closed since 2012, when supply of gas was shut off amid disruptions in the wake of the political events of the previous year. Its reopening would have expanded Egypt’s ability to export natural gas to European markets.

Damietta liquefaction plant to reopen in 3Q2019? - ENTERPRISE

Wednesday, 28 August 2019

Deja vu: Damietta LNG plant to reopen in 3Q2019? The Damietta liquefaction plant will reopen by the end of 3Q2019 after being offline for the past six years, an unnamed oil industry source tells Youm7. The facility, which produces around 5 mn tonnes of liquefied natural gas per year when operational, has been closed amid a long-running dispute between the Egyptian government and operator Union Fenosa Gas (UFG).

We’ve heard this one before: An oil ministry source said back in February that the plant would reopen in April following an agreement with UFG. This was proved wrong just two days later when UFG publicly denied reaching a settlement. Then last month Eni (a joint partner in UFG with Union Fenosa) said that the facility should open “soon this year”, and another source claimed that the facility would be operating at full capacity by 4Q2019. For the latest claim to be realistic, there needs to be a resolution to the five-year UFG dispute within the next four weeks. Forgive us if we keep our eyebrows raised on this one.