Libya’s National Oil Corporation (NOC) announce the successful conclusion of arbitration brought against it in front of the ICC Court in Paris by Trasta Energy Limited, a subsidiary of the Emirati Al Ghurair Investment Group (“Trasta”) and the Libyan Emirati Refining Company (LERCO), the company which owns and operates the Ras Lanuf Refinery which is a joint venture between the NOC and Trasta.
Mustafa Sanalla, Chairman of the the NOC said, the “NOC is the trusted guardian of Libyan oil wealth. We will make every effort to defend that wealth. We stress the importance of LERCO re-starting operations in Ras Lanuf Oil Refinery as soon as possible.”
Trasta and Lerco commenced the arbitration proceedings against the NOC in late 2013 and it has taken the two cases’ tribunals over three years to decide on the dispute and issue final rulings. On 5 January 2018, the ICC Tribunal hearing the Lerco/ NOC case dismissed all Lerco damage claims against the NOC which amounted to the total of US$ 812 million. The tribunal awarded NOC compensation for its counterclaims of US$ 116 million plus interest.
This award follows a decision issued last November in the case brought against NOC by Trasta, in which a separate ICC tribunal pronounced that Trasta was not entitled to any of its claims totalling more than US$ 100 million pursuant to the Shareholders Agreement signed between NOC and Trasta. This pronouncement forced Trasta to withdraw all its claims thereafter.
Both these awards constitute victories for NOC against its litigants and reflect the strength of the NOC’s arguments and legal grounds by which NOC refuted the litigants’ claims or reinforced its counterclaims.
NOC potential losses are estimated at more than US$ 10 billion had the Lerco claims been accepted and the contract relationship with Al Ghurair Group continued on the basis as demanded by Lerco for the contract period agreed upon in the FSA.
The “NOC will now take all necessary steps and procedures to ensure the enforcement of the award issued in the Lerco case by the Arbitration Tribunal on 05 January 2018. Trasta and Lerco are requested to fully comply with the implementation of their contractual obligations.”, Sanalla added.
