A Pakistani oil company has won a legal battle against a Bermuda-based company at the International Court of Arbitration. This victory confirms Pakistan’s legal authority over Petroleum Concession Agreements (PCAs) and Joint Operating Agreements (JOAs).
The court’s ruling is a significant achievement for Pakistan, as it reinforces the country’s legal control over oil sector agreements. The tribunal determined it did not have jurisdiction in the case and ordered the losing company to pay for arbitration costs.
The dispute began when Bermuda-based Frontier Holdings Ltd (FHL) challenged the Pakistani oil company in relation to partnerships in the Badin North and Badin South blocks. These partnerships have been in place since 2006. The court’s decision emphasizes the importance of adhering to Pakistani laws when making agreements in the country’s oil sector.
This outcome marks a major milestone for Pakistan, strengthening its legal oversight and authority in the oil and gas industry. It serves as a reminder for foreign companies to comply with local laws when entering into agreements in Pakistan’s energy sector.
