Sterling Resources Ltd. has filed a Notice of Default with the National Agency of Mineral Resources ("NAMR") as a result of NAMR's failure to grant license assignments to Sterling's farm in partners Petro Ventures Europe BV and Gas Plus International BV (together the "Partners") for a 20% and 15% license holding respectively on its Midia and Pelican Blocks in the Black Sea (the "Concession").
On January 24, 2011 Sterling and its Partners, at the request of NAMR, submitted new applications, supported by required documentation, to request assignments for the Partners onto the Concession Agreement. These applications followed and superseded Sterling's previous attempts to obtain assignments for its Partners beginning from April 2009, when Sterling's initial assignment applications were submitted.
Pursuant to the Concession Agreement NAMR has the sole authority to grant such assignment requests, and has the obligation to not unreasonably withhold or delay its consent to such applications and to treat such applications within a maximum of 90 days. NAMR, by failing to provide its decision on the re-submitted application with the 90 day period, has failed to comply with this obligation, despite having informed Sterling and the Partners that it has no objections to their form or content. It is Sterling's contention that NAMR's failure to approve the applications for assignment is political in nature.
In the event that NAMR and Sterling are unable to resolve the situation then this would put the two parties into a dispute resolution procedure which could ultimately be decided in international arbitration.
Mike Azancot, Sterling's Chief Executive Officer, said: "NAMR's failure to decide on the applications for assignments is extremely unfortunate and frustrating, and is in direct contravention to the Company's rights under the Concession Agreement. This failure, as well as other actions and inactions by the government of Romania leading to Sterling's earlier declaration of Force Majeure, are damaging the economic well-being of the country. Timely development of Romania's offshore natural resources could dramatically reduce the reliance on imported gas, bring substantial employment and investment benefits to the country and provide significant and stable tax receipts for the government. The actions that we are now taking are done with the expressed intent of seeking formal resolution to certain blockages that are impeding our proactive approach to the progress of our work and investments offshore Romania."
Sterling Resources Ltd. is a Canadian-listed international oil and gas company headquartered in Calgary, Alberta with assets in the United Kingdom, Romania, France and the Netherlands.
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