{"id":5424,"date":"2016-11-23T17:31:25","date_gmt":"2016-11-23T17:31:25","guid":{"rendered":"http:\/\/www.oilnewskenya.com\/?p=5424"},"modified":"2017-01-24T15:08:24","modified_gmt":"2017-01-24T15:08:24","slug":"tata-petrodyne-farm-in-behind-swala-otto-energy-dispute-in-tanzania","status":"publish","type":"post","link":"https:\/\/www.oilnewskenya.com\/index.php\/tata-petrodyne-farm-in-behind-swala-otto-energy-dispute-in-tanzania\/","title":{"rendered":"Tata Petrodyne Farm-in behind Swala, Otto Energy dispute in Tanzania"},"content":{"rendered":"

A simmering dispute between two Australian companies Swala and Otto Energy in Tanzania could have emanated from a failed joint farm-down by Tata Petrodyne Limited.<\/p>\n

According to Swala Energy in it latest presentation to shareholders the two joint venture partners had earlier agreed on a joint farm-down by Tata Petrodyne Limited where it would get equity in both the Pangani and Kilosa-Kilombero licenses from both partners.<\/p>\n

However the operator said it assessed that a joint farm down would add additional complexity resulting to a new agreement between the then JV partners that the Indian company would farm into just Swala\u2019s 25% which it did<\/a> in June 2015 with the $5.7 million transaction<\/a> completed in the following October. There were discussions regarding Otto then farming down 12.5% to Swala.<\/p>\n

Swala however blames Otto Energy for not going ahead to pursue the matter even after holding initial discussions around a draft farm-in agreement.<\/p>\n

Thereafter in early February 2016 Swala blames its Australian counterpart of delaying drilling at Kito prospect<\/a> located in the Kilosa-Kilombero license with the backing of the new entry partner Tata which has now been pushed<\/a> to 2017. The operator argued the delay to the commitment well on technical and financial grounds and Tanzania Petroleum Development Corporation (TPDC) also declined to allow the request<\/p>\n

\u201cOn the 22nd February 2016 Otto\u2019s lawyers contacted the Chairman of Swala Energy Limited (Australia) (SWE) demanding payment for the (incomplete) Pangani farm-down \u2013 coincidence that this was done 6 days after not getting their own way on Kilosa-Kilombero?. We discussed possible mechanisms to progress the farm-in, but Otto presented obstacles,\u201d says Swala CEO David Mestres Ridge.<\/p>\n

Swala claims that Otto\u2019s argument is flawed as its assertion that the directors of SWE had controlled the actions of the board of Swala is wrong as there are just two directors and four \u2018independent\u2019 directors.<\/p>\n

\u201cThose SWE directors had removed \u2018Otto\u2019s money\u2019 from Swala and sent it to SWE (actually, we sent $2.51 million and retained $3.2 million in Swala); and \u2013 Therefore (so the argument) the SWE directors should, through their insurance, reimburse Otto for a transaction that Otto has chosen not to complete \u2013 it has had 14 months to transact,\u201d Ridge adds.<\/p>\n

Otto in May commenced a legal action against\u00a0against Swala, current and certain former directors seeking to recover a gross amount of approximately US$1,000,000 plus alleged damages in relation to the Pangani licence of which the partners have told the TPDC of their desire to\u00a0relinquish<\/a>\u00a0 after the technical review of the licence showed no structures of commercial interest. Swala Energy said they intended to defend such legal action with vigour and, having taken initial legal advice, were of the opinion that Otto\u2019s claim had no legal merit.<\/p>\n

Otto Energy has also gone ahead to push for the removal<\/a> of Swala as the operator after defaulting in various cash calls.<\/p>\n

These notices relate to:<\/p>\n

    \n
  1. defaults in relation to non-payment by SOGTP of cash calls and associated interest accrued under the JOAs;<\/li>\n
  2. claims by Otto Tanzania for payment of interest accruing under the JOAs as a result of SOGTP\u2019s defaults, amounting to approximately US$360,000; and the removal of SOGTP as Operator of the Kilosa-Kilombero licence area following SOGTP\u2019s failure to satisfy the joint venture partners that it is not insolvent.<\/li>\n<\/ol>\n

    Otto Energy has since reached a farm-down<\/a> agreement with MV Upstream Tanzania Limited (MV Upstream), a joint venture between Vegas Oil & Gas Limited, (Vegas) and Motor Oil Hellas SA (MOH) in respect of the assignment of a 25% participating interest in the Kilosa-Kilombero Licence onshore Tanzania.<\/p>\n

    The matter now being progressed in the Australian courts<\/p>\n","protected":false},"excerpt":{"rendered":"

    A simmering dispute between two Australian companies Swala and Otto Energy in Tanzania could have emanated from a failed joint farm-down by Tata Petrodyne Limited. According to Swala Energy in … Read More<\/a><\/p>\n","protected":false},"author":24,"featured_media":3921,"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":[7,11],"tags":[565,3421,872,3479,4603,5562,1940,5561,2447,4193,4602],"class_list":["post-5424","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-oil-politics","category-top-news","tag-david-mestres-ridge","tag-dispute","tag-farm-in","tag-kilosa-kilombero-licence","tag-motor-oil-hellas-sa","tag-mv-upstream-tanzania-limited","tag-otto-energy","tag-swala","tag-swala-energy","tag-tata-petrodyne","tag-vegas-oil-gas-limited","entry"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2015\/10\/Tata-Swala.jpg?fit=200%2C200&ssl=1","jetpack_shortlink":"https:\/\/wp.me\/p5JWkQ-1pu","jetpack-related-posts":[{"id":5434,"url":"https:\/\/www.oilnewskenya.com\/index.php\/swala-energy-jv-partners-risk-losing-kilosa-kilombero-in-tanzania\/","url_meta":{"origin":5424,"position":0},"title":"Swala Energy JV Partners Risk Losing Kilosa-Kilombero in Tanzania","author":"","date":"November 28, 2016","format":false,"excerpt":"Kilosa-Kilombero block operator Swala and joint venture partners Otto Energy, Tata Petrodyne and MV Upstream are in the risk of losing their license with every indication they are likely to meet their commitment obligations following their ongoing dispute and court case in the Australian high court. The partners had earlier\u2026","rel":"","context":"In "Oil Politics"","block_context":{"text":"Oil Politics","link":"https:\/\/www.oilnewskenya.com\/index.php\/category\/oil-politics\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2016\/03\/Kito-Prospect-Map.png?fit=899%2C529&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2016\/03\/Kito-Prospect-Map.png?fit=899%2C529&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2016\/03\/Kito-Prospect-Map.png?fit=899%2C529&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2016\/03\/Kito-Prospect-Map.png?fit=899%2C529&ssl=1&resize=700%2C400 2x"},"classes":[]},{"id":3036,"url":"https:\/\/www.oilnewskenya.com\/index.php\/swala-energy-completes-farm-tanzanian-licenses-tata-petrodyne\/","url_meta":{"origin":5424,"position":1},"title":"Swala Energy Completes farm-out of Tanzanian Licenses to Tata Petrodyne","author":"","date":"June 1, 2015","format":false,"excerpt":"Swala Energy Limited has announced that Swala Oil and Gas (Tanzania) Plc has reached agreement with Tata Petrodyne Limited a subsidiary of the multinational Tata Sons Limited, under which TPL shall farm into the Pangani and Kilosa-Kilombero licences in Tanzania. Tata Sons Limited is the holding company of the Tata\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\/2014\/10\/swala-energy-1.jpg?fit=650%2C451&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2014\/10\/swala-energy-1.jpg?fit=650%2C451&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2014\/10\/swala-energy-1.jpg?fit=650%2C451&ssl=1&resize=525%2C300 1.5x"},"classes":[]},{"id":5843,"url":"https:\/\/www.oilnewskenya.com\/index.php\/swala-oil-gas-issues-otto-energy-with-notice-of-withdrawal-in-tanzania\/","url_meta":{"origin":5424,"position":2},"title":"Swala Oil & Gas Issues Otto Energy With Notice Of Withdrawal in Tanzania","author":"","date":"April 4, 2017","format":false,"excerpt":"Swala Oil & Gas (Tanzania) plc \u00a0has advised that it has exercised its option under the Kilosa-Kilombero Joint Operating Agreement (JOA) to require Otto Energy (Tanzania) Pty Ltd \u00a0to withdraw from the JOA and the Kilosa-Kilombero Production Sharing Agreement. Swala Oil & Gas accuses Otto of failing to fulfill its\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\/2014\/10\/kilosa-kilombero.png?fit=337%2C329&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":3919,"url":"https:\/\/www.oilnewskenya.com\/index.php\/tata-petrodyne-seals-farm-out-transaction-with-swala-energy-after-payment-of-5-7-million\/","url_meta":{"origin":5424,"position":3},"title":"Tata Petrodyne seals farm-out transaction with Swala Energy after payment of $5.7 million","author":"","date":"October 19, 2015","format":false,"excerpt":"Swala Energy Limited has confirmed that US$5.7 million has been received from Tata Petrodyne Limited (TPL) pursuant to the farm-out transaction with TPL for the Kilosa-Kilombero and Pangani licences in Tanzania. This was one of the outstanding terms of their farmout agreement for the Kilosa-Kilombero and Pangani licences in Tanzania\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\/2015\/10\/Tata-Swala.jpg?fit=200%2C200&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":7920,"url":"https:\/\/www.oilnewskenya.com\/index.php\/swala-oil-gas-tata-petrodyne-limited-partnership-ends-in-tanzanias-kilosa-kilombero-licence\/","url_meta":{"origin":5424,"position":4},"title":"SWALA OIL & GAS, TATA PETRODYNE LIMITED PARTNERSHIP ENDS IN TANZANIA’S KILOSA-KILOMBERO LICENCE","author":"","date":"January 22, 2020","format":false,"excerpt":"Swala Oil & Gas (Tanzania) plc in its December announcement said it had exercised its option under the Kilosa-Kilombero Joint Operating Agreement to require Tata Petrodyne Limited to withdraw from the JOA and the Kilosa-Kilombero Production Sharing Agreement . Folllowing the withdrawal Swala\u2019s Participating Interest increased from 75% to 100%,\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":"","width":0,"height":0},"classes":[]},{"id":4889,"url":"https:\/\/www.oilnewskenya.com\/index.php\/otto-energy-pushes-to-remove-swala-energy-as-operator-in-tanzanias-kilosa-kilombero-license\/","url_meta":{"origin":5424,"position":5},"title":"Otto Energy pushes to Remove Swala Energy as Operator in Tanzania’s Kilosa-Kilombero License","author":"","date":"August 1, 2016","format":false,"excerpt":"Otto Energy Ltd through its wholly-owned subsidiary, Otto Energy (Tanzania) Pty Ltd, has said \u00a0it wants current operator Pangani and Kilosa-Kilombero licenses relieved off its role after defaulting in various cash calls. According to Otto Energy its subsidiary has issued various notices to Swala Oil and Gas (Tanzania) plc (SOGTP),\u2026","rel":"","context":"In "Oil Politics"","block_context":{"text":"Oil Politics","link":"https:\/\/www.oilnewskenya.com\/index.php\/category\/oil-politics\/"},"img":{"alt_text":"Kito Prospect Map","src":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2016\/03\/Kito-Prospect-Map.png?resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2016\/03\/Kito-Prospect-Map.png?resize=350%2C200 1x, https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2016\/03\/Kito-Prospect-Map.png?resize=525%2C300 1.5x, https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2016\/03\/Kito-Prospect-Map.png?resize=700%2C400 2x"},"classes":[]}],"jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/posts\/5424","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/users\/24"}],"replies":[{"embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/comments?post=5424"}],"version-history":[{"count":1,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/posts\/5424\/revisions"}],"predecessor-version":[{"id":5425,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/posts\/5424\/revisions\/5425"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/media\/3921"}],"wp:attachment":[{"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/media?parent=5424"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/categories?post=5424"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/tags?post=5424"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}