Pearl Petroleum initiates arbitration against Khor Mor EPC contractor

Pearl Petroleum files for arbitration against Khor Mor EPC contractor: Pearl Petroleum, a consortium majority-owned by Dana Gas and Crescent Petroleum, initiated arbitration proceedings against Enerflex, the EPC contractor for the Khor Mor gas expansion project in Iraq, seeking to “recover costs and damages arising from Enerflex’s defective performance,” according to an ADX filing (pdf) by Dana Gas.

We knew this was coming: Pearl said it may seek damages from Enerflex last month, after terminating Enerflex’s EPC contract and assuming direct control of the project, effective 9 September. Pearl cited performance issues on Enerflex’s part as the reason for its decision, claiming that the Canadian energy infrastructure supplier failed to “meet its contractual obligations, leading to unacceptable delays” and affecting the project’s progress.

What’s next? Dana Gas said it is working with its Pearl Petroleum partners to bring the project back on track, with updates on the new expected completion date expected in “due course,” the statement reads.