RE: Bloe not getting Block 1223 Jul 2020 13:18
https://www.interpressnews.ge/ka/article/610678-mtavroba-pronterastankontrakts-agar-moshlis/
The Georgian government has decided not to terminate its contract with Frontera Resources Georgia Corporation and to allow the company to continue operating in the part of the original contract area where oil production has been under way since Soviet times. We are talking about about 1% of the state search area, because about 99% of this area "Frontera" has already returned to the state according to the arbitral award.
According to a statement issued by the Ministry of Economy and Sustainable Development, "the decision of the state is conditioned by the strategic goals of the country, namely: Shadow in any form to attach to this characteristic. "Maintaining a very positive perception of the reputation and investment climate of the country is our most important task."
According to the statement, "Relations with the United States, which is the main strategic partner of our country, is a fundamental and principled issue for us. Although the issue of Frontera is not a topic of discussion in official relations at all, it is unequivocally undesirable for us to have an excuse for anyone in America's highly diverse political spectrum to use this absolutely routine commercial dispute to the detriment of strategic relations between our countries. "Georgia's investment image and close relationship with the United States are important, first and foremost, for its relationship with the American business community, because special attention is always paid to attracting American investment to Georgia."
As it is known to the public, as a result of an arbitration dispute in the Hague Arbitration Court, the Arbitration Tribunal upheld the Georgian position against Frontera Resources Georgia Corporation and sued the Oil and Gas Corporation and the State Oil Company. In particular, the arbitral tribunal found that Frontera had materially breached the contract of 25 June 1997 for the distribution of products and the processing plant, which, in turn, became a solid legal basis for the termination of the contract. In addition, the decision of the arbitral tribunal, Frontera was instructed to return the search area (approximately 99 percent of the contract area) to the state and reimburse the costs incurred by the Georgian side in connection with the arbitration dispute (total payment obligations approximately $ 6 million). It should be noted that according to the 1997 contract, Frontera was to carry out exploration work within 10 years in order to discover and further exploit new commercial reserves of hydrocarbons. After the expiration of this period, "Frontera" requested 2 more times to extend the search period, which was satisfied by the Georgian side. Consequently, the total search term has been increased by 20 years, which is an unprecedented example in the industry.
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