Monday 22 January 2018

Petroceltic adviser to claim it is due millions

Dispute over Algerian gas deal

Roisin Burke

A former Petroceltic adviser is strongly defending legal action against it in relation to the Irish explorer's activities in north Africa, claiming to be owed millions.

The High Court case relates to payments that consultancy company Abdelly & Associes says are owed by Petroceltic Isarene, the oil and gas explorer's Algerian assets holder.

Petroceltic is led by Irish exploration industry figure Brian O Cathain, with former Tullow Oil top executive Tom Hickey as financial officer.

At issue are millions alleged to be due from an agreement to pay 7.5 per cent from net production income on the Algerian prospect.

Also claimed to be due is €9.4m which Tunisia-based Abdelly & Associes is understood to be asserting was not paid as part of an agreement signed in 2005, which it is believed Abdelly will claim was board-approved by Petroceltic.

Earlier payment instalments of circa €5m were made, it is understood.

In Petroceltic's Irish High Court case, lodged during the summer, it alleged fraud, naming defendants Abdelly & Associes, Samir Abdelly and an individual named Maza Seghir in relation to consultancy agreements related to its north Africa activities.

On November 11, Judge Peter Kelly granted judgement to Petroceltic that rendered agreements with Mr Seghir null and void. Proceedings against Mr Abdelly, which are believed to be on identical grounds, are ongoing.

Petroceltic's legal advice was that original agreements constituted "a fraud on the company" and has consequently issued legal proceedings to have them declared void.

It is also seeking to recover payments made to Abdelly and Seghir in 2004 and 2005, and it is understood that the judgement in favour of Petroceltic in relation to Mr Seghir provides for seeking return of payments and involves the larger portion of the contested payments.

When contacted last week, Mr Abdelly's lawyer, Joe Kelly of AL Goodbody, said his client couldn't comment on the details of the case as they were confidential.

Petroceltic also declined to comment beyond its original statement to the markets while the case is ongoing. Mr Seghir could not be contacted.

When announcing the legal case in June, Petroceltic said it would consider any further actions that may be required to protect its interests.

Last month, Petroceltic sold a further chunk of its Ain TSila Algerian oil field to Sontrach, the Algerian State oil company, in a deal worth around €130m including additional development costs and future payments. The asset is seen as one of the world's biggest potential oil and gas finds.

A circa €320m market cap company, it has operations in north Africa, the Mediterranean Basin and the Black Sea. Last week, it said it was withdrawing from one of its Romanian wells where quantities of gas discovered weren't commercial, but has plans to drill another well in the country.

Petroceltic is also considering a main exchange listing, boss O Cathain told this paper earlier in August. The AIM-listed company plans to list on the main London Stock Exchange in late June and peg for FTSE 250 status.

"A modest 10 per cent increase would bring us to FTSE level and give us access to capital and UK investors," O Cathain said. "Petroceltic started in 2003 with one asset and one man in a basement on Northbrook Road. It's always been our aim to have a major listing."

It will drill nine wells in the coming 12 months in the Black Sea, Kurdistan and the Mediterranean.

Sunday Independent

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