Proactive | 13 July 2023

Rockhopper Exploration takes step closer to settlement in Italy dispute

by Jamie Ashcroft

Rockhopper Exploration PLC (AIM:RKH) told investors it is one step closer to receiving €190 million from Italy, following the prior positive ruling from the International Centre for Settlement of Investment Disputes (ICSID).

The latest development was a decision on 11 July to lift a provisional stay of enforcement.

The ICSID convened an ad hoc committee in early March 2023, after Italy sought to annul a previous award favouring Rockhopper, granted in August 2022 under the Energy Charter Treaty. The previous award included compensation plus interest at EURIBOR + 4%, compounded annually from January 2016.

Effectively, this latest development allows Rockhopper to enforce the ICSID award, provided that it establishes an escrow account within five business days.

The committee, meanwhile, maintains the right to revise its decision at any time and is yet to rule on legal costs.

It comes after the parties failed to agree on escrow arrangements, leading to Rockhopper submitting a proposal on May 24, 2023.

Rockhopper noted that the committee’s decision to lift the enforcement stay does not imply any judgment on the merits of Italy’s annulment request, which is due for a final hearing in the first quarter of 2024.

"We welcome the approach adopted by the ad hoc Committee and believe this outcome will allow us to commence enforcement with no risk to Italy of non-recoupment pending the outcome of the annulment," Rockhopper chief executive, Sam Moody said in a statement.

Rockhopper is presently bearing all legal costs associated with the annulment process.