Sudan asks OVL to withdraw arbitration on oil dues
New Delhi: Sudan has asked ONGC Videsh Ltd to withdraw its case against the African nation in an international arbitration court for recovery of over $400 million in unpaid oil dues, saying it is making efforts to mitigate the default.
OVL, the overseas investment arm of state-owned Oil and Natural Gas Corp (ONGC), however, wants to continue with the arbitration while the two sides work out a suitable mechanism to resolve the issue, the company said in a statement here.
OVL had earlier this year dragged the government of Sudan to a London court to recover dues pending since 2011.
"A Sudanese ministerial delegation visited OVL corporate office last week and held discussions with ONGC Videsh officials led Narendra K Verma, Managing Director and CEO," the statement said.
OVL has filed an arbitration claim in a London court to recover about $300 million for oil Sudan bought from its Greater Nile Oil Project and another $98.94 million in unpaid pipeline rent lease.
"The Ministerial delegation informed that the Government of Sudan is making sincere efforts to mitigate the issue of default on paying dues to OVL.
"It was informed that the Government of Sudan is hopeful that its economic situation shall be improving henceforth with the recent agreement it reached with the Government of South Sudan on the resumption of crude oil transportation from South Sudan territory through the Heglig-Port Sudan pipeline," it said.
The delegation, the statement issued by OVL said, requested the company to withdraw the arbitration proceedings.
"OVL expressed its happiness for the positive response from Sudan and stated that it is always ready to work with Sudan to find a workable solution to clear the pending dues in a time-bound manner," it said.
OVL, however, was of the belief that "keeping the legal intricacies in view, the arbitration process can continue while both sides work together on a suitable mechanism of resolving the issues".
OVL had in 2003 acquired 25 per cent interest in the Greater Nile Oil Project in Sudan. China's CNPC holds 40 per cent stake in the project, while Malaysia's Petronas has 30 per cent and Sudapet of Sudan owns remaining 5 per cent.