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.

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.

Petroceltic to seek arbitration against EGPC for inability to pay debts - AHRAM ONLINE

Sunday 17 Feb 2019

UK international energy company Petroceltic has announced its intention to seek arbitration in a dispute with Egypt's state-owned Egyptian General Petroleum Corporation (EGPC) over what Petroceltic says is the Egyptian company's failure to pay debts.

Petroceltic said in a statement that it is seeking arbitration with the World Bank-managed International Centre for Settlement of Investment Disputes over EGPC's "breach of its obligations under multiple Gas Sales Agreements and in particular EGPC’s inability to pay its debts as they fall due for payment."

Petroceltic Chairman Angelo Moskov said that the company has invested hundreds of millions of dollars in Egypt and sustained hundreds of EGPC jobs in joint venture with EGPC, at considerable expense to Petroceltic.

Opinion writers are mad we are losing at int’l arbitration - ENTERPRISE

Monday, 17 September 2018

Opinion writers, unhappy Egypt is “losing” at int’l arbitration, simply miss the point: Since the USD 2 bn ruling handed down by the International Centre for Settlement of Investment Disputes in favor of Union Fenosa, opinion writers have expressed frustration at this “losing streak.” Ziad Bahaa El Din is urging in Al Shorouk the government to review all its oil and gas contracts to avoid losing future arbitration hearings. Mohamed Saleh concurs in AMAY, urging the government to seek the expertise of legal minds. AMAY’s Newton is complaining about the size of the loses, which he claims have reached EGP 38 bn, while AMAY’s Mohamed Abu Al Ghar is suggesting that the officials who have signed the contracts to be corrupt.

All four miss the point: None of them explain to their readers why we failed to meet our natural gas export obligations (it’s called “force [redacted] majeure” for a reason, people) —and none get the point that settling outstanding disputes is key to Egypt’s aim of emerging as the eastern Med’s premier energy hub.

Gov’t hints at willingness to settle on Union Fenosa arbitration ruling - ENTERPRISE

Wednesday, 5 September 2018

Gov’t hints at willingness to settle on Union Fenosa arbitration ruling: It is the general policy of the government, and the Oil Ministry specifically, to seek a settlement in international arbitration cases, an Oil Ministry source told Al Mal. 

His statements are the first we’ve heard since news broke that the World Bank’s International Centre for Settlement of Investment Disputes ordered Egypt to pay USD 2 bn in settlements yesterday to Spanish-Italian JV Union Fenosa Gas (UGS) for the government cutting off supplies to UGS’ Damietta liquefaction plant. 

The source noted that the ministry is carefully studying the ruling before issuing an official statement on the matter, but added that the ministry was intending to resupply the plant and other liquefaction plants as its regional energy hub strategy gains steam. Supplies of natural gas will be restored by 2019, the source noted.

Egypt to pay Spanish-Italian JV $2bn in natural gas dispute - FINANCIAL TIMES

3 September 2018
Myles McCormick and David Sheppard

Ruling by World Bank panel poised to accelerate resumption of country’s LNG exports
A joint venture between Spain’s Naturgy and Italy’s Eni has been awarded a $2bn settlement from Egypt over gas supplies by a World Bank arbitration body, in a move that could accelerate the resumption of the country’s liquefied natural gas exports.

The ruling by the International Centre for Settlement of Investment Disputes comes after Egypt stopped supplying gas to Unión Fenosa Gas joint venture’s Damietta LNG plant as the country faced internal energy shortages in the wake of the political turmoil unleashed by the Arab Spring.

Unión Fenosa Gas took its case to the ICSID in 2014. The arbitration body on Monday found that in stopping the gas supply Egypt had failed to grant Unión Fenosa Gas “fair and equitable treatment”, contravening the country’s bilateral investment protection treaty with Spain, Naturgy said in a statement.

The $2bn is likely to be paid in the form of renewed gas supplies to Damietta rather than in cash, according to people familiar with the matter.

Naturgy, formerly known as Gas Natural Fenosa, said the award would allow it to reach a “comprehensive agreement” with Egypt to resume gas supplies to the plant, which were halted four years ago.

Arbitrator rules Egypt must compensate EMG - GLOBES

2 Mar, 2017 15:56
Aviv Levy

The international arbitration panel ruled that Egypt failed to protect the Sinai pipeline from terrorists.

An announcement published yesterday by Ampal-American Israel Corporation concerning the arbitration ruling issued in the past few days by the International Centre for Settlement of Investment Disputes (ICSID) in Washington DC is likely to give hope to the company's bondholders. The company went bankrupt under controlling shareholder Yosef Maiman, with debts of nearly NIS 1 billion.