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Georgia’s Oil Corp Accuses Frontera Resources of ‘Distorting Int’l Arbitration Court’s Ruling’

The Georgian Oil and Gas Corporation (GOGC), a state-owned entreprise, issued a statement on May 7 accusing Frontera Resources – a Texas-based oil and gas company – of “distorting International Arbitration Tribunal’s ruling” and refusal to disclose proceedings of the long-running legal dispute.

GOGC alleged that Frontera tried to put a political spin on a “purely commercial dispute,” declining to recognize a defeat in a high-profile case over exploitation rights of oil fields in Eastern Georgia.

GOGC said it had sent a termination notice to the Georgian branch of Frontera and requested it to pay due compensation on the basis of the arbitration court’s ruling on Frontera’s failure to meet its contractual obligations.

However, Georgian state enterprise argued, Frontera is unwilling to publish Tribunal’s ruling and has refused to fulfill GOGC’s requests in due course.

Earlier GOGC reported that on April 17, the International Arbitration Tribunal upheld “a vast majority of its claims” raised against Frontera Resources concerning a production sharing contract and refinery study signed in 1997.

The Tribunal ruled that Frontera Resources Georgia Corporation committed “material breach of the contract by refusal to relinquish and return to the [Georgian] State the exploration area,” representing “almost 99% of the entire contract area,” according to GOGC.

The arbitration body ordered Frontera to pay damages to GOGC and reimburse claimant’s other costs, according to the Hogan Lovells, an international law firm whose attorneys were representing GOGC in the Tribunal.

GOGC stressed that the Tribunal had the final say on the case and was “binding on the parties, in accordance with its terms and the contract.”

Controversy around U.S.-based company’s operations in Georgia has beset bilateral relations since U.S. Congressman Markwayne Mullin (R-OK2) sent a letter to the Georgian government on January 13, 2020, raising an alert due to “harassment and expropriation attacks” against Frontera Resources by Georgian authorities.

Davit Bakradze, Georgia’s Ambassador in Washington, slammed Mullin’s appeal as “an act of lobbyism.”

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This post is also available in: ქართული (Georgian) Русский (Russian)


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