{"id":4310,"date":"2016-02-01T06:58:23","date_gmt":"2016-02-01T06:58:23","guid":{"rendered":"http:\/\/www.oilnewskenya.com\/?p=4310"},"modified":"2017-01-26T09:35:30","modified_gmt":"2017-01-26T09:35:30","slug":"kenyas-block-l6-jv-partners-far-pancontinental-oil-gas-clash-over-cash-calls","status":"publish","type":"post","link":"https:\/\/www.oilnewskenya.com\/index.php\/kenyas-block-l6-jv-partners-far-pancontinental-oil-gas-clash-over-cash-calls\/","title":{"rendered":"Kenya\u2019s Block L6 JV partners FAR, PanContinental Oil & Gas Clash Over Cash Calls"},"content":{"rendered":"

Kenya\u2019s Block L6 operator Australia\u2019s Far has said it issued a default notice to it\u2019s partner in the L6 Joint Venture (Pancontinental Oil and Gas) for continued failure to pay two cash calls from 12 Feb 2015 although the latter has disputed the notices in a new statement.<\/p>\n

\u201cUnder the terms of the Joint Operating Agreement, FAR has issued a default notice to it\u2019s partner in the L6 Joint Venture (Pancontinental Oil and Gas) for continued failure to pay two cash calls from 12 Feb 2015,\u201d Far told investors in its latest quarterly activities report.<\/p>\n

Responding to a statement FAR issued to its shareholders PanContinental Oil and Gas alleges the joint venture had only planned work to be undertaken on block L6 onshore of which civil upheaval and security<\/a> incidents prevented any appropriate access for petroleum operations to be conducted.<\/p>\n

PanContinental Oil and Gas adds that there is still no access to that portion and therefore no work is capable of being carried out on that portion of block L6 and hence there remains no need for the cash call.<\/p>\n

PanContinental is also outranged by the default notice claiming that the operator had told the joint venture the majority of the $377, 801 funds to be raised were to be used by FAR\u2019s subsidiary Flow Energy Pty Ltd staff and consultants.<\/p>\n

The partner also has an issue with the calculations in which PanContinental claims should the cash calls have been valid share of the 2015 Cash Calls should be US$60,448 based on a 16% share of the \u201conshore\u201d portion of block L6; not US$113,060 (based on a claimed 40% interest) as claimed by Flow.<\/p>\n

\u201cThe 2015 Cash Calls issued to Pancontinental were on the basis that Pancontinental\u2019s paying interest was 40%; not 16% without an explanation concerning the status of Milio<\/a>. No work has been authorised by the joint venture to be carried out on the so called \u201coffshore\u201d portion of block L6 in which Pancontinental does have a 40% paying interest,\u201d Pancontinental Oil and Gas CEO and Executive Director \u00a0Barry Rushworth \u00a0said in a statement.<\/p>\n

The company also claims to have already honored paid US$38,060 (representing a share of fees payable to the Kenyan Ministry which Pancontinental was prepared to pay), thus leaving an amount purportedly owing of US$22,388 (which Pancontinental also disputes).<\/p>\n

By letters dated 9 September 2015 Pancontinental wrote to Flow disputing the 2015 Cash Calls as well as the validity of the default notice and calling on Flow to provide it with relevant information.<\/p>\n

According to PanContinental FAR is yet to provide a written response to those letters.<\/p>\n

Meanwhile the operator says it continued discussions with the Government of Kenya to secure a one year extension to the current Petroleum Sharing Contract to allow exploration activity that has been hindered by recent tensions on ground, to commence. FAR is planning for a 2D seismic<\/a> survey to commence as soon as possible.<\/p>\n

In Block L6 FAR has 24% paying interest, PanContinental 16% and Milio International 60%. Offshore FAR has 60% interest while PanContinental has 40%. FAR has said it will reduce<\/a> its offshore interest to under 25%. FAR has operatorship in both block L6 onshore and offshore.<\/p>\n","protected":false},"excerpt":{"rendered":"

Kenya\u2019s Block L6 operator Australia\u2019s Far has said it issued a default notice to it\u2019s partner in the L6 Joint Venture (Pancontinental Oil and Gas) for continued failure to pay … Read More<\/a><\/p>\n","protected":false},"author":24,"featured_media":4311,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[11],"tags":[313,4043,3421,867,1252,1570,1585,1961,2267,2272],"class_list":["post-4310","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-top-news","tag-block-l6","tag-cash-calls","tag-dispute","tag-far","tag-kenya","tag-milio-international","tag-ministry-of-energy-petroleum","tag-pancontinental-oil-gas","tag-security","tag-seismic","entry"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2016\/02\/Block-L6-new.jpg?fit=900%2C720&ssl=1","jetpack_shortlink":"https:\/\/wp.me\/p5JWkQ-17w","jetpack-related-posts":[{"id":6277,"url":"https:\/\/www.oilnewskenya.com\/index.php\/insecurity-hampers-operations-kenyas-block-l6\/","url_meta":{"origin":4310,"position":0},"title":"Insecurity Hampers Operations in Kenya\u2019s Block L6","author":"","date":"September 8, 2017","format":false,"excerpt":"Australian explorer and block L6 onshore operator FAR Ltd has formally notified the Ministry of Energy & Petroleum in Kenya of a force majeure event over Block L6 according to its latest half year results communication to shareholders. 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According to the operator which suspended activity within the block earlier this year citing insecurity the\u2026","rel":"","context":"In "Top News"","block_context":{"text":"Top News","link":"https:\/\/www.oilnewskenya.com\/index.php\/category\/top-news\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2017\/09\/WWF-Block-L6.jpg?fit=1123%2C794&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2017\/09\/WWF-Block-L6.jpg?fit=1123%2C794&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2017\/09\/WWF-Block-L6.jpg?fit=1123%2C794&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2017\/09\/WWF-Block-L6.jpg?fit=1123%2C794&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2017\/09\/WWF-Block-L6.jpg?fit=1123%2C794&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":482,"url":"https:\/\/www.oilnewskenya.com\/index.php\/pancontinental-onshore-kenya-l6-farmed-out-for-seismic-and-drilling\/","url_meta":{"origin":4310,"position":2},"title":"PanContinental: Onshore Kenya L6 Farmed-Out For Seismic and Drilling","author":"Samuel Kamau Mbote","date":"February 10, 2014","format":false,"excerpt":"Pancontinental Oil & Gas and its wholly owned subsidiary Afrex Limited (together\u00a0\u201cPancontinental\u201d) has entered a farm-in\u00a0agreement for the onshore portion of Kenyan exploration area Block L6 in the Lamu Basin. Block L6 is partly onshore and partly offshore. 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