LONDON: Victoria Oil & Gas’s whose wholly owned subsidiary, Gaz du Cameroun S.A. (GDC) has signed a settlement agreement with Eneo which will result in the payment of the gross amount to GDC, within 30 days of the signing, of approximately 2.74 billion FCFA (Central African CFA franc) (circa US$5 million).
GDC is the onshore gas producer and distributor with operations located in the port city of Douala, Cameroon.
Victoria Oil & Gas terminates agreement to supply gas to ENEO
This settlement relates to the Take-or-Pay invoices for October, November and December 2019 plus associated interest. During this period for which Take-or-Pay invoices were issued, gas was not being supplied to Eneo because there was no demand.
At the time of the termination of the contract with Eneo in July 2020, VOG had ten Take-or-Pay invoices outstanding. With this settlement, the Company has now recovered four out of ten of these outstanding invoices plus interest to February 2021.
All of the amounts invoiced to Eneo were fully provided for in the Annual Accounts for the year ended 31 December 2019 and the Interim Statement for the period to 30 June 2020. The payment to GDC will represent full and final settlement for all amounts invoiced to Eneo.
Roy Kelly, Chief Executive of the Company, commented: “We are very pleased to have settled another legacy issue without recourse to time-consuming and expensive litigation or arbitration, as such legal costs have been crippling the company in recent years. Arbitration would be under Cameroonian law and could take several years.
We believe the avoidance of further legal costs in pursuit of the Eneo receivables is in the best interests of shareholders and partners, and allows management to focus on the business and strategy.”