Yaoundé - 08 May 2021 -

ENEO ends long-standing dispute with GDC with XAF2.7 bln settlement agreement

ENEO ends long-standing dispute with GDC with XAF2.7 bln settlement agreement
  • Comments   -   Tuesday, 20 April 2021 12:31

(Business in Cameroon) - In a notice published yesterday, April 19, Victoria Oil & Gas (VOG), announces that a settlement agreement was reached with electric utility ENEO concerning its long-standing case with Gaz du Cameroun S.A. ("GDC").  "On 16 April 2021, GDC signed a settlement agreement with Eneo which will result in the payment of the gross amount to GDC, within 30 days of the signing, of approximately 2.74 billion FCFA (Central African CFA franc: circa US$5 million).  This settlement relates to the Take-or-Pay invoices for October, November, and December 2019 plus associated interest (…) The payment to GDC will represent full and final settlement for all amounts invoiced to Eneo," VOG writes.

"We are very pleased to have settled another legacy issue without recourse to time-consuming and expensive litigation or arbitration, as such legal costs have been crippling the company in recent years. Arbitration would be under Cameroonian law and could take several years," commented Roy Kelly, VOG CEO.

Recently, during an interview with Business in Cameroon, ENEO CEO Eric Mansuy indicated that his company’s dispute with GDC was being settled amicably. However, he provided no additional details.

The dispute came to public attention with a note published on July 3, 2020, by VOG. In the note, VOG announced the termination of its gas supply contract [ for operations at the 50MW Logbaba power plant] with electric utility Eneo. The British oil and gas operator also threatened to take legal action if the electricity producer did not pay the XAF9.3 billion in unpaid bills it was still owing by end of June 2020. Meanwhile, for most of the stated period, GDC never supplied ENEO.

  "It should first be noted that this dispute is not about invoices, but about the conditions for gas supply resumption and electricity production at the Logbaba site. This is what the dispute is all about," Eric Mansuy explained during an interview at the time.

"Let me tell you, generally, in the electricity sector, disputes are settled amicably, with public authorities’ assistance usually. Gaz du Cameroun’s approach, in this case, is in stark contrast with the usual practices because we must all ensure that the sector is developed," said Eric Mansuy. The April 16, 2021, agreement shows that Eric Mansuy succeeded in bringing GDC management to the negotiating table.

Brice R. Mbodiam

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