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Tuesday, 26 July 2016

Government settles USD 1.2 bn dispute with Bawabet Al Kuwait Holding

The government has allegedly agreed to settle a USD 1.2 bn dispute with fertilizer and petrochemical manufacturer Bawabet Al Kuwait Holding, a subsidiary of Egyptian Kuwait Holdings, after three years of negotiations, Al Ahram reported, describing the case as “one of the biggest settlement cases between the government and investors.” The company gave up a USD 1.2 bn compensation claim it initiated in 2011 and waived the arbitration suit at the Washington D.C.-based International Centre for Settlement of Investment Disputes, the newspaper says, not specifying what EKH might have received in return. The dispute is rooted in the government unilaterally backing out of a 15-year contract to supply the company with gas at a price of USD 3/mbtu. The settlement terms have not been made clear in the local press, which only reported that GASCO will guarantee Alexandria Fertilizers Company, a subsidiary of Bawabah Al Kuwait, “continuous and uninterrupted supplies” of 15.2 bcf of gas per year but not the price.

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