SAPNRG

0.050

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OTHERS ARBITRATION PROCEEDINGS Issuance of a Request for Arbitration by Yunneng Wind Power Co. Ltd. ("Claimant") to Sapura Offshore Sdn. Bhd. ("SOSB") and Sapura Energy Berhad ("SEB" or "the Company")

SAPURA ENERGY BERHAD

Type Announcement
Subject OTHERS
Description
ARBITRATION PROCEEDINGS
Issuance of a Request for Arbitration by Yunneng Wind Power Co. Ltd. ("Claimant") to Sapura Offshore Sdn. Bhd. ("SOSB") and Sapura Energy Berhad ("SEB" or "the Company")

We refer to our earlier announcement dated 4 February 2022 in respect of the termination of a Contract dated 15 March 2019 for the Provision of Transportation and Installation of Offshore Wind Turbine Substructures for the offshore wind turbines at the Yunlin Offshore Wind Farm for the Claimant in Taiwan (the “Contract”).

 

Further to such announcement, the Board of Directors of the Company wishes to announce that each of (a) SEB and (b) SOSB (a wholly-owned subsidiary of SEB), was served with a request for arbitration dated 29 December 2023 (the "Request for Arbitration", or the "Request") on 22 January 2024. This Request for Arbitration was only brought to our attention after the end of business on 26 January 2024. Details of the Request for Arbitration are briefly as set out in the section entitled "Details of the Request for Arbitration" below.

 

In brief, in the Request for Arbitration, the Claimant:

 

(a) has claimed a provisional claim amount of EUR50,000,000 for certain alleged breaches of the Contract (but has reserved the right to further specify and expand its claims, and to claim damages for any damage incurred);

 

(b) has stated that that the Claimant filed the Request for Arbitration primarily to suspend the statute of limitations under German law in respect of the claims specified in the Request for Arbitration;

 

(c) has acknowledged its submission of a proof of debt with SEB and SOSB as at 31 December 2023 for purposes relating to the Proposed Schemes of Arrangement (as described and defined in our announcement dated 8 March 2023) proposed to be undertaken by SEB and SOSB under Section 366 of the Companies Act 2016; and

 

(d) has acknowledged that its claims in relation to the Contract would be determined through and be subject to the assessment procedure for the Proposed Schemes of Arrangement (as stipulated in the order of the High Court dated 10 March 2022 granted under Originating Summons No. WA-24NCC-148-03/2022 and the order of the High Court dated 8 March 2023 granted under Originating Summons No. WA-24NCC-121-03/2023).

 

2.        Details of the Request for Arbitration

 

           2.1 By way of background:

 

                 2.1.1 The Claimant and SOSB had on 15 March 2019 entered into the Contract, being a German law-governed agreement for the transport and installation of offshore wind turbine substructures for the Yunlin offshore wind farm in Taiwan.

 

                  2.1.2 SEB had on 24 May 2019 issued on behalf of SOSB a parental company guarantee to secure the complete and correct fulfilment of any and all of SOSB's obligations under or in connection with the Contract.

 

                  2.1.3 On 4 February 2022 SEB announced that SOSB had issued a termination notice to the Claimant in respect of the Contract on 3 February 2022, on grounds of material breach by the Claimant as more particularly described in SEB's announcement dated 4 February 2022.

 

           2.2 The Request for Arbitration dated 29 December 2023 was filed by the Claimant against SEB and SOSB with the German Arbitration Institute (Deutsche Institution für Schiedsgerichtsbarkeit e.V.) ("DIS").

 

           2.3 Under the Request, the Claimant amongst other things:

 

                 2.3.1 claims that SOSB did not comply with the agreed schedule under the Contract on the alleged basis that SOSB was - inter alia - unable to deploy the relevant installation vessels required to conduct the installation of certain structures on time;

 

                 2.3.2 seeks an award of EUR 22,479,613.20 against SOSB and SEB as "Delay Liquidated Damages" for alleged breach of contract;

 

                 2.3.3 seeks an award of EUR 7,493,204.40 against SOSB and SEB as “further proven damages” for alleged breach of contract in excess of delay liquidated damages; and

 

                 2.3.4 seeks an award declaring SOSB and SEB jointly and severally liable towards the Claimant for all "further proven delay damages" it has allegedly suffered or will suffer in excess of EUR 29,972,817 as the aggregate amount of delay liquidated damages and further proven damages for alleged wilful failure by SOSB to comply with the Contract, as well as all costs of the arbitration;

 

                 2.3.5 has estimated the provisional amount in dispute under the Request to be EUR 50 million; and

 

                 2.3.6 has indicated that that the Claimant filed the Request for Arbitration primarily to suspend the statute of limitations under German law in respect of the claims specified in the Request (which would otherwise have expired by 31 December 2023), in order to allow the Claimant to maintain its claims under the Proposed Schemes of Arrangement.

 

3          Under the DIS Arbitration Rules, SOSB and SEB are required to:

 

             3.1 file a notification on or before 12 February 2024 nominating an arbitrator inter alia; and

 

             3.2 file an answer to the Request by 7 March 2024, unless SOSB and SEB request an extension of time under the DIS Arbitration Rules on or before 12 February 2024.   

 

4         SOSB and SEB are currently seeking legal advice from their external counsels on the strength and merits of the claims set out in the Request, as well as SOSB’s and SEB's legal position in relation thereto. In addition, the proof of debt submitted by the Claimant in connection with the Proposed Schemes of Arrangement for SEB and SOSB is currently being assessed by the nominated chairman for the relevant court-convened meetings in accordance with the assessment procedure for such Proposed Schemes of Arrangement, as stipulated in the order of the High Court dated 10 March 2022 granted under Originating Summons No. WA-24NCC-148-03/2022 and the order of the High Court dated 8 March 2023 granted under Originating Summons No. WA-24NCC-121-03/2023.

 

This announcement is dated 30 January 2024.






Announcement Info

Company Name SAPURA ENERGY BERHAD
Stock Name SAPNRG
Date Announced 30 Jan 2024
Category General Announcement for PLC
Reference Number GA1-30012024-00076