Have you invested in an Italian offshore oil field? Then you might be entitled to compensation.
Oil and gas explorer Rockhopper thinks so, and is beginning a legal fight with Italy. The London-listed company said on Thursday it has “commenced international arbitration proceedings against the Republic of Italy concerning the Ombrina Mare project in the Adriatic”.
In February 2016 Italy’s ministry of economic development decided not to award Rockhopper a production concession covering Ombrina Mare. The company is now seeking damages, on the basis of lost profits, alleging Italy has broken the Energy Charter Treaty, legislation which governs energy sector investments.
Chief executive Sam Moody said Rockhopper had hoped to avoid taking action, but that it was “necessary in order to protect our investment in the Ombrina Mare project.” He added:
While it may take some time to produce a result, and there is no certainty of success, Rockhopper is taking all necessary steps to protect its shareholders’ interests at no extra cost to the Company.
The company also said:
In addition, the Company has secured non-recourse funding for the arbitration from a funder that specialises in financing commercial litigation and arbitration claims. In the event of success (with an award above a nominal threshold) Rockhopper retains a very material proportion of any award.