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OTHERS Issuance of Notices of Arbitration by Brunei Shell Petroleum Company Sdn. Bhd. ("Claimant") to Sapura Fabrication Sdn. Bhd. ("SFSB") and Sapura Offshore Sdn. Bhd. ("SOSB"), wholly-owned subsidiaries of Sapura Energy Berhad ("SEB" or "the Company")

SAPURA ENERGY BERHAD

Type Announcement
Subject OTHERS
Description
Issuance of Notices of Arbitration by Brunei Shell Petroleum Company Sdn. Bhd. ("Claimant") to Sapura Fabrication Sdn. Bhd. ("SFSB") and Sapura Offshore Sdn. Bhd. ("SOSB"), wholly-owned subsidiaries of Sapura Energy Berhad ("SEB" or "the Company")

The Board of Directors of Sapura Energy Berhad (“SEB” or “the Company”) wishes to announce that the following wholly-owned subsidiaries of the Company (“Subsidiaries”) were each served with a separate Notice of Arbitration on 30 September 2023, details of which are as follows:

 

Details of the Subsidiaries and the Notices of Arbitration

 

1.       Sapura Fabrication Sdn. Bhd. (“SFSB”)

 

          1.1           Notice of Arbitration dated 29 September 2023 (the “Salman Notice”) filed with the Singapore International Arbitration Centre (“SIAC”) by Brunei Shell Petroleum Company Sdn. Bhd. (“Claimant”).

 

                        1.1.1 SFSB and the Claimant had on 30 August 2019 entered into a contract for engineering, procurement, construction and installation works related to the Salman project (“Contract”).The Claimant had purported to terminate part of the Contract for cause on 13 March 2023, for various alleged breaches of the Contract by SFSB (the "Salman Dispute"). This was previously announced to Bursa Malaysia on 8 June 2023.

 

                        1.1.2 The Salman Notice constitutes the Claimant’s request to have the Salman Dispute be referred to arbitration under the SIAC Rules in accordance with the arbitration agreement in the Contract (“Salman Arbitration”). The Claimant in the Salman Arbitration has sought the following relief, as set out in the Salman Notice:

 

                                 1.1.2.1 a declaration that the Claimant had validly terminated part of the Contract for cause;

                                 1.1.2.2 a declaration that SFSB had breached certain provisions of the Contract; and

                                 1.1.2.3 award of monetary relief to the extent necessary to fully compensate the Claimant for the damages suffered resulting from the breaches and termination event;

                                 1.1.2.4 an order for indemnification of the Claimant for all costs, expenses, and fees in the arbitration; and

                                 1.1.2.5 pre- and post-award interest.

 

                        1.1.3 Under the SIAC Rules, SFSB is required to file a Response to the Salman Notice with the SIAC within 14 days of receipt of the Notice, that is to say, by or before 16 October 2023.

 

           1.2        There is at present a pending application in the General Division of the High Court of the Republic of Singapore filed by SFSB for, among other things, recognition of the reorganisation proceedings in Malaysia and a stay of all legal proceedings concerning SFSB’s property, rights, obligations or liabilities. (“Singapore Recognition Application”). Creditors (including the Claimant) that (i) are based in Singapore, (ii) have commenced and/or intended to commence legal action against SFSB in Singapore, or (iii) whose applicable dispute resolution clause specified that any dispute with SFSB is to be resolved by way of arbitration in Singapore or litigation through the Singapore courts, have been notified of the Singapore Recognition Application. It is SFSB’s position that the Singapore Recognition Application, if granted, should also operate to stay the Salman Arbitration.

 

          1.3         SFSB is seeking legal advice from its external counsel on the strength and merits of the Salman Arbitration, as well as SFSB’s legal position therein.

 

 

2.       Sapura Offshore Sdn. Bhd. (“SOSB”)

 

          2.1         Notice of Arbitration dated 29 September 2023 (the “PRP-7 Notice”) filed with SIAC  by Brunei Shell Petroleum Company Sdn. Bhd. (“Claimant”).

 

                        2.1.1 SOSB and the Claimant had on 29 February 2020 entered into a contract to fabricate transport, install and pre-commission the pipelines relating to the PRP-7 Pipeline Replacement Project (“Contract”). The Claimant had purportedly reduced the scope of the Contract for cause on 13 March 2023, for alleged breaches of the Contract by SOSB (“PRP-7 Dispute”).

 

                        2.1.2 The PRP-7 Notice constitutes the Claimant’s request to refer the PRP-7 Dispute to arbitration under the SIAC Rules in accordance with the arbitration agreement in the Contract (“PRP-7 Arbitration”). The Claimant in the PRP-7 Arbitration has sought the following relief, as set out in the PRP-7 Notice:

 

                                  2.1.2.1 a declaration that the Claimant had validly reduced the scope of the Contract for cause;

                                  2.1.2.2 a declaration that SOSB had breached certain provisions of the Contract; and

                                  2.1.2.3 award of monetary relief to the extent necessary to fully compensate the Claimant for the damages suffered resulting from the breaches and termination event leading to the Claimant’s reduction of the Scope of the Contract for cause;

                                 2.1.2.4 an order for indemnification of the Claimant of all costs, expenses, and fees in the arbitration; and

                                 2.1.2.5 pre- and post-award interest.

 

                        2.1.3 Under the SIAC Rules, SOSB is required to file a Response to the PRP-7 Notice with the SIAC within 14 days of receipt of the Notice,  that is to say, by or before 16 October 2023.

 

          2.2         There is at present a pending application in the General Division of the High Court of the Republic of Singapore filed by SOSB for, among other things, recognition of the reorganisation proceedings in Malaysia and a stay of all legal proceedings concerning SOSB’s property, rights, obligations or liabilities (“Singapore Recognition Application”). Creditors (including the Claimant) that (i) are based in Singapore, (ii) have commenced and/or intended to commence legal action against SOSB in Singapore, or (iii) whose applicable dispute resolution clause specified that any dispute with SOSB is to be resolved by way of arbitration in Singapore or litigation through the Singapore courts, have been notified of the Singapore Recognition Application. It is SOSB’s position that the Singapore Recognition Application, if granted, should also operate to stay the PRP-7 Arbitration.

 

          2.3         SOSB is seeking legal advice from its external counsel on the strength and merits of the PRP-7 Arbitration, as well as SOSB’s legal position therein.

 

This announcement is dated 2 October 2023.

 

 

 






Announcement Info

Company Name SAPURA ENERGY BERHAD
Stock Name SAPNRG
Date Announced 02 Oct 2023
Category General Announcement for PLC
Reference Number GA1-02102023-00099