JKX Commences Arbitration Proceedings Against Ukraine

JKX resorted to the Energy Charter Treaty to seek compensation from Ukraine for alleged violations that would have hit its bottom line breaching existing treaties.

‘In particular, JKX is seeking repayment of more than USD 180 million in rental fees that its Ukrainian subsidiary has paid on production of oil and gas in Ukraine since 2011’ reads a note released on Monday. 

The company commenced arbitration proceedings under the Energy Charter Treaty, and other bilateral treaties. JKX said that Ukraine failed to treat JKX's investments in a "fair and equitable" manner. 

In the note, JKX reported that the Emergency Arbitrator issued an Emergency Award in January 2015, which disposed a halt to royalties on the production of the Ukrainain subsidiary in excess of the rate of 28%. 

In case of Ukrainian non-compliance with the order issued by the Emergency Arbitrator, JKX said it would bring Kiev to court.