10 February 2015, Lagos – All seem not to be well with the relationship between Afren Energy and Amni International. This is because Afren Energy Resources, a subsidiary of Afren PLC in the UK has received a notice of default and termination from one of its Nigerian partners, Amni International Petroleum Development Company.
Afren Energy, a technical service provider to Amni International in the operation of Okoro field has been having trouble lately as its share price fell from two pounds on London Stock Exchange to less than ten pence in few months.
Vanguard gathered that the genesis of the current disagreement with Amni International is the termination of the Okoro further field development project in oil mining lease (OML) 112 by Afren despite Amni’s contrary opinion. The termination of the proposed pipeline laying contract , well head platform and mobile offshore production unit may cause the proposed Okoro further field development project over one hundred million USD in avoidable liquidated damages and losses.
A source close to the two companies said the crisis currently engulfing Afren on the London Stock Exchange coupled with the current low oil price environment may have informed the decision of Afren to terminate contracts related to Okoro further field development project without due regards to the position of Amni International, who is the operator.
By the production sharing and technical services agreement between the two companies, Afren has 30 days to remedy all the defaults and complaints made by Amni, if a dispute leading to termination is to be avoided.