Peak O&G Terminates Deal with Cadco Over Cadlao Project in Palawan Basin
Australia's Peak Oil and Gas Limited (Peak) reported Thursday that on July 28, the company announced that it had executed a conditional settlement deed (Deed) with Cadlao Development Company Limited (Cadco) (formerly Blade Petroleum Limited) in relation to the Company's dispute with Cadco regarding the Cadlao Farmin Agreement (Cadlao FIA) for Service Contract (SC) 6, located in the northwest Palawan Basin in the Philippines, which contains the Cadlao Redevelopment Project.
The Deed requires Peak, inter alia, to:
- transfer its interests in Peak Royalties Limited which holds certain overriding royalty rights pertaining to SC6 Cadlao
- terminate the Cadlao FIA between Peak and Cadco which effectively releases any claim Peak has to direct working interests in SC6 Cadlao (not including the Peak's interest in VenturOil); and
- terminate the arbitration process (Arbitration) in respect to its dispute with Cadco regarding the Cadlao FIA
In return, Cadco would pay Peak an amount of approximately $6.3 million (AUD 6.7 million).
The parties agreed that settlement would take place Aug. 6. However Cadco has failed to remit the agreed amount by this date.
Whilst Cadco has signalled it wishes to agree a new settlement date, Cadco is unwilling to provide a fixed date which Peak is able to rely upon. Accordingly, the Deed is now terminated and the parties will resume their original commercial and legal positions immediately prior to the execution of the Deed. Arbitration will be immediately recommenced.
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