State-owned Petrotrin will decide by the end of next week if it is going to go to the High Court to try and set aside the results of an arbitration with A&V Oil and Gas, or pay the company close to $1 billion. But even as the state enterprise mulls its decision, A&V’s lead attorney, Ramesh Lawrence Maharaj SC, is urging Petrotrin not to go to court, claiming it will be a waste of time, delay the inevitable and only lead to lawyers earning more money.
In a brief telephone interview with Guardian Media yesterday, Petrotrin chairman Michael Quamina said the board of directors has the legal opinion from its Senior Counsel Deborah Peake, urging it to take the issue quickly to the High Court and will consider the advice and may also seek other legal advice before making a decision.
“I have to tell you that I am not directly involved in the matter since I have recused myself, but yes, the Petrotrin board will have to look at it, look at Senior’s legal opinion and perhaps other legal opinions and then make a decision. I will not be part of the decision but I know things are in train to meet by the end of next week and we will meet the tight deadlines.”
In a 16-page opinion, Peake urged Petrotrin to move quickly to file an application in the High Court to set aside the results of an arbitration between A&V Oil and Gas and Petrotrin that could cost the state company close to $1 billion.
In a confidential opinion done for Petrotrin on the outcome of a recent arbitration between itself and A&V, Peake argued that the arbitral panel involved in the matter made fundamental errors in coming to their conclusion and that the state-owned company had a good chance of success if it went to the High Court for relief.
Maharaj yesterday slammed this assertion, saying it will have little chance of success and that it was doomed to failure.
Peake’s opinion read: “In the premises, we are of the respectful view that the award discloses gross and fundamental errors on the face of the award and the arbitrators are guilty of misconduct in the conduct of the proceedings. The findings on the principal issues are irrational and unsupported by the evidence. For the foregoing reasons, we are of the view that the prospects of setting aside the award are good.”
But Maharaj said this is at variance with what Peake told the arbitration panel when she appeared before them, and quoted sections of the transcript which he said showed Peake was satisfied that the arbitration was conducted fairly.
The A&V Oil and Gas issue first came to light when Opposition leader Kamla Persad-Bissessar read on a political platform a report that alleged A&V Oil and Gas, which is owned by Nazim Baksh, a man Prime Minister Dr Keith Rowley describes as his friend, was charging Petrotrin for oil his company did not actually produce.
Petrotrin subsequently investigated the issue and discontinued its contract with A&V Drilling for crude from the Catshill field in Rio Claro.
Peake, who represented Petrotrin in the arbitration, argued that unless moves are made now to stop the arbitration, the company could find itself paying out significant sums.
“Unless the award is set aside, there is a high probability that in any further hearing on the issue of the quantum of damages to which the tribunal has decided that A&V is entitled, the tribunal will award substantial damages, particularly since it has decided (remarkably having regard to the evidence) that all A&V’s witnesses are credible.”
A&V has asked the tribunal that it be awarded US$119,409,000, or the equivalent of TT$808,398,930. This does not include issues of cost and other money which Petrotrin is said to be holding in escrow for oil under dispute.
However, Peake argued that the arbitral panel, which comprised Sir Dennis Byron, Lord David Hope and CVH Stollmeyer, made several errors during the matter, including placing an erroneous burden of proof on Petrotrin that there were reasonable grounds for suspicion that A&V was misrepresenting the amount of oil produced and sold to the State company and that the panel also had the wrong standard of proof.
She insisted the ruling is inconsistent with the 2018 ruling of the Court of Appeal in the A&V Oil and Gas vs Petrotrin case.
The arbitral panel is yet to make a decision on the final quantum it will award A&V drilling as a result of the termination of its contract by Petrotrin, but Peake noted that on Tuesday, A&V had already made an application for a $75 million part payment of the money that would be owed to it due to the award.