Last week Vanoil Energy announced that the board of directors has instructed management to conduct an immediate review of all Company operations as it shifts its priority aggressively pursue its legal arbitration claims against the Republic of Kenya.
As a result the goal is to eliminate non-essential costs, dispose of non-productive assets and secure sufficient funding to enable Vanoil to aggressively pursue its case against Kenya at the International Court of Justice.
According to interim President and CEO Don Padget following the resignation of Mr. Sam Malin as president, chief executive officer and director of the Company effective October 30, 2014 the company is now looking to reduce cost by 75%.
“The immediate response of management in implementing our new directives is greatly appreciated. We believe our new plan will quickly reduce monthly costs by over 75% and allow the Company to focus on reaching a full and fair settlement with the Republic of Kenya for the loss of money, time and opportunity experienced by the Company over the past several years,” says Padget.
The company commenced an international arbitration against the Government of Kenya as the “Respondent” following what the company says is a dispute arising from the breach of the Production Sharing Contracts for Blocks 3A and 3B in Kenya.
Vanoil denies that it was involved in speculation in Kenya as stated by the Kenyan government and says the only reason for its delays in drilling was a number of incidents of local disturbance and unrest which led to a directive by local government authorities to reduce and then delay operations until a safe return to the site could be provided.
Vanoil sees as unfair that the PSC’s were not renewed following the experienced at the drill site and is now demanding a $150 million as full and proper restitution for its seven years of exploration and development, based upon the net present value of its investment in Kenya.