Oilex (West Kampar) Limited (OWK), a wholly owned subsidiary of Oilex Ltd, incorporated in Cyprus and a party to the West Kampar Production Sharing Contract ('PSC') continues to seek resolution of disputes with Indonesian joint venture party and operator PT Sumatera Persada Energi (SPE.

OWK is pursuing the recovery of a debt in excess of US$4.1 million owed by SPE to OWK arising out of SPE's failure to repay monies advanced by OWK under the farmout agreement entered into by them in August 2008 which was subsequently terminated in January 2009.

Under the terms of a parent company guarantee provided to OWK at the time of entering into the farmout agreement, PT Asiabumi Petroleo ('Asiabumi'), the parent company, guaranteed SPE's obligations to repay the monies owing under the farmout agreement. Asiabumi has not met its obligations and OWK consequently filed an arbitration proceeding in the International Chamber of Commerce in Singapore on 30 April 2009. The first arbitration hearing occurred on 25 January 2010 and is scheduled to be continued on 18 and 19 February 2010.

Tags: Oilex