Cameroon distribution firm Eneo puts an end to its dispute with Victoria Oil & Gas

In its Unaudited Interim Condensed Consolidated Financial Statements for the six months ending on June 30, 2020, British firm Victoria Oil & Gas Plc (VOG), which operates in Cameroon under the name Gaz du Cameroun (GDC), reveals that in August 2020, it concluded a long-standing dispute with the Cameroonian government, after a “protracted negotiation.”

The said dispute concerns the Logbaba concession agreement. After the negotiations, GDC is compelled to pay back-dated liabilities amounting to $10.2 million (XAF5.52 billion) representing the net amount due by GDC.  

“GDC and its joint venture partner are seeking to ensure that the royalty amounts payable are netted against amounts due by the Cameroonian State for their participating interest in the Logbaba Project and accordingly the Directors have included an assumption in their forecast that the amount of US$10.2 million will not be paid within the next twelve months as discussions continue concerning the State’s participating interest in the Logbaba Project,” the report reads.

VOG indicates that there is no guarantee the Cameroonian State will adhere to GDC's proposed settlement of the claim and that any obligation to pay the royalty in the short term would have a significant impact on the Group's ability to continue operations.

Let’s note that Logbaba natural gas power plant is the result of a public-private partnership (between the National Hydrocarbons Company (SNH) and Victoria Oil & Gas). Since January 2012, through a 16-km pipeline, the plant has been delivering its products to some 20 industrial companies in Douala.

About XAF50 billion was invested in this natural gas-fired power plant (which has generated 100 direct jobs) and its daily production capacity is about 1.4 million cubic meters.

Source:Business In Cameroon