Tap Oil says it expects any bidders for Burrup Fertilisers will have to contact it, as the legal and contractual disputes over its gas supply deal with Burrup escalate.
Tap Oil chief financial officer David Rich told a conference call that the company had not yet been contacted by Burrup’s receivers PPB Advisory, or any of the rumoured bidders for the urea manufacturing plant on the Burrup Peninsula.
“The receiver isn’t really talking to us, so in terms of settling it, our internal position is that we would imagine that any bidder for Burrup is going to want certainty over the gas supply into the plant,” Mr Rich said.
“At the moment they haven’t got that so we would expect that the receiver or the bidders are going to have to talk to (the Harriet joint venture) at some stage to sort that out.”
Tap is a member of the Harriett joint venture, which has a long-term low-priced gas supply deal with Burrup.
Mr Rich's comments follow a report that Tap and Kuwait's Kufpec lodged a Supreme Court writ yesterday, asking for details of any communication between PPB and the potential buyers for Burrup.
They will reportedly argue that the Harriet joint venture's (Tap, Kufpec and Apache Energy) gas supply deal may be null and void if details of the contract have been disclosed to another party.
Separately, the company is also seeking clarification to resolve what damages may be payable if Tap fails to supply gas under the agreement, which was entered into in December 2001.
Tap has maintained it has no liability for any shortfall of gas supply as a consequence of force majeure, and is concerned Burrup Fertilisers has expressed contrary views about its obligations under the gas supply agreement.
It issued a notice of force majeure to Burrup in December 2006, stating that it and its fellow joint venture participants did not have sufficient reserves of gas to supply the contracted share of Burrup’s requirements for the remaining 21 years of the agreement.
Tap said it anticipated being able to supply its share of gas under the GSA for the next four to five years.
Meanwhile, former Burrup Fertilisers owner Pankaj Oswal has again hit out at PPB, saying it had charged $1.19 million in fees and expenses to Burrup Holdings, which has not been placed in receivership.
“This amount is in addition to the massive $12 million in accounting and legal fees and expenses charged to Burrup Fertilisers,” Mr Oswal said in a statement.
“This is fee gouging at its worst and I intend demanding a review into the efficacy of PPB’s actions.”
