Jersey Oil and Gas (JOG) has announced an $850,000 (£620,000) pay out after a legal dispute with subsea firm TGS-Nopec Geophysical Company.
TGS, a Norwegian subsea data firm, claimed for $1million in uplift payments related to Jersey’s awards in the Oil and Gas Authority’s 31st offshore licensing round, and Jersey’s acquisition of Equinor’s 70% stake in the Verbier discovery in January 2020.
Jersey disputed the claims but, after two hearings in Norwegian courts, the firm agreed the $850,000 settlement.
TGS was hired in 2018 to deliver a seismic data set which determined the location of the appraisal well for the Verbier discovery.
However, after drilling the well in April 2019, Equinor and Jersey reported “disappointing” results, leading to Equinor selling back its stake.
In its half-year accounts published in September, Jersey said it had allocated £200,000 as a precaution for the TGS dispute.
TGS has been contacted for comment.
A statement from JOG said its cash position as of the end of December 31, 2020 was £5million following this “one-off and isolated dispute”.
Jersey added: “We look forward updating shareholders on the group’s Greater Buchan Area (GBA) development project during the course of Q1 2021.”
The firm estimates around 140million recoverable barrels of oil are available at the GBA, utilising a number of discoveries including Verbier.
In September it announced a fixed platform would be its preferred option.
A final investment decision is expected in 2022, ahead of first production in 2025.