The International Court of Arbitration Chamber of Commerce has dismissed Petro Trans’ claim that the Ministry of Mines, Petroleum and Natural Gas of Ethiopia unlawfully revoked the exploration and development contracts it had signed with Petrotrans in 2011.
The Geneva-based tribunal decided in favor of Ethiopia by rejecting Petro Trans’ claim to be reinstated or awarded compensation of $1.4 billion, Tolosa Shagi, Ethiopia’s Minister of Mines, Petroleum and Natural Gas said Saturday evening in a press conference.
The verdict is a lesson for those companies who don’t operate in accordance with the terms of their contract, the minister said
According to Tolosa, the tribunal’s decision also shows how much the country’s mining laws and agreements are up to international standard and that the action taken against Petro Trans was appropriate.
He also added that the tribunal’s ruling gives a clear picture to those companies which want to work with the Ethiopian government in the future not to miscalculate.
Ethiopia’s Ministry of Mines, Petroleum and Natural Gas and Petro Trans signed the agreement in July 2011 that enables the latter to explore and develop petroleum and natural gas in five blocks in the eastern part of the country.
According to Tolosa, the agreement was revoked by the Ethiopian government after the company failed to carry out its contractual obligation, including within an extended period of time, and after repeated warnings.
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