Foreign firm seeks govt help to enforce $7mn arbitration ruling against Pakistani energy firm 

Frontier Holdings Ltd (FHL), a foreign oil and gas exploration company, has approached the Petroleum Division, requesting its intervention to enforce an international court ruling against Petroleum Exploration (Pvt) Ltd (PEL), a local energy firm.

As reported, FHL’s letter to the Director General of Petroleum Concessions at the Petroleum Division underscores its success in jurisdictional proceedings before the Singapore International Commercial Court (SICC). The SICC overturned a prior decision by an International Chamber of Commerce (ICC) arbitral tribunal, which had ruled it lacked jurisdiction over disputes between FHL, a foreign working interest owner (FWIO), and PEL, a Pakistani working interest owner (PWIO).

The dispute centers on the Petroleum Concession Agreements and Joint Operating Agreements concerning the Badin IV South and Badin IV North Blocks in Sindh. FHL had initiated arbitration under the ICC framework following disagreements with PEL. However, the ICC tribunal initially determined that disputes under the Badin Concession Documents should be resolved through domestic arbitration in Pakistan rather than international arbitration under ICC auspices.

FHL challenged this jurisdictional ruling before the SICC, which, on December 30, 2024, determined that the ICC tribunal had misinterpreted the Badin Concession Documents. The SICC ruled that such disputes must be resolved through international arbitration outside Pakistan and directed the ICC tribunal to proceed accordingly.

Separately, on December 10, 2024, FHL secured another ruling from the ICC arbitral tribunal, which dismissed PEL’s attempt to forfeit FHL’s 27.5% working interest in the Badin Blocks. The tribunal confirmed FHL’s ownership and rejected PEL’s counterclaims totaling $483 million. Additionally, the ICC tribunal awarded FHL $7 million in damages, including $2 million in compounded interest at a rate of two percent per month.

FHL stated in its letter that the awarded damages and interest would continue to accrue until PEL fulfills its payment obligations.