30 July 2014

Tanzania: British Gas Opposes Application On Disposal of Gas Block Interests

THE British Gas Tanzania Limited has opposed the application filed by businessman Moto Mabanga to prevent disposal of interests in three disputed gas blocks along offshore in Mtwara.

British Gas Tanzania Limited is the Managing Partner and majority shareholder, with 60 per cent share interests in gas blocks One, Three and Four, situated in the Region, in Southern Tanzania.

The company dealing with oil and gas business was expected to join hands with Mr Mabanga to prevent two other foreign companies, Ophir Energy PLC, Ophir Services PTY Limited, from selling their remaining 20 per cent interests to a third party.

But, in the counter affidavit filed in court recently, British Gas Tanzania Limited vehemently opposed the requests, by Mr Mabanga, claiming, "Prayers for injunction and deposit of security will interfere with (their) finances and business transactions and cause considerable inconveniences, expenses and loss."

The two Ophir companies retained 40 per cent shares in those assets and turned over the management control to British Gas Tanzania Limited.

A newly formed Singaporean gas dealing firm, Pavilion Energy Pte Limited, bought 20 per cent shares, leaving Ophir companies with 20 per cent only.

Mr Mabanga, a Tanzanian businessman living in South Africa, has filed an application before the High Court, seeking orders to restrain the said three companies from effecting the sale transaction to Pavilion Energy Pte Limited, which has been joined as a necessary party.

British Gas Tanzania Limited has jumped in the band wagon with Ophir Companies to oppose the injunction on the latter's 20 per cent shares, which in fact is the only insurance or security, pending the settlement of the disputed interests in the said three gas bloc assets.

It is alleged that the company's curious move is compounded by the reason that they have argued before to have had nothing to do with the matter between Ophir companies and Mr Mabanga, who claims to have been deceived to offer his five per cent interests in each block for 7.5 million US dollars.

Mr Mabanga, in his application, is also seeking for a temporary injunction restraining the respondents from any further disposition or taking any other similar detrimental action in respect of the remaining Ophir's 20 per cent shares in the gas blocks, pending the hearing and determination of the petition.

"The necessary party be retrained by an order of temporary injunction from paying 38 million US dollars to the respondents, which money is payable following the final investment decision in respect of the development of blocks One, Three and Four, currently expected in 2016," reads one of prayers.

In the alternative to the restraint orders, Mr Mabanga, who is represented by advocates Mabere Marando and Jethro Turyamwesiga, is requesting the court to order the respondents, jointly and together to deposit a total of 322 million US dollars with the court, pending hearing of the dispute.

He alleged that Ophir Energy PLC, Ophir Services PTY Limited concluded a sale of 60 per cent ownership shares of the disputed offshore gas blocks with British Gas Tanzania without his knowledge and up to now the respondents have never disclosed as per his lawyer's request letter dated April 30, 2012.

Having sold the 60 per cent shares, Ophir Energy PLC, Ophir Services PTY Limited remained with 40 per cent shares in the said blocks and the duo has also sold 20 per cent shares to the necessary party, Pavilion Energy Pte Limited, thus remaining with 20 per cent shares only.


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