Home / NEWS / KRG suspends DNO for 6 weeks after OSE revelations


KRG suspends DNO for 6 weeks after OSE revelations

by Kevin Baxter on Sep 22, 2009


(Getty Images)
(Getty Images)

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The Kurdistan Regional Government (KRG) has announced that it has suspended all of the Norwegian oil exploration and production company DNO for a period of up to six weeks.

Dr Ashti Hawrami, minister of natural resources for the semi-autonomous Iraqi state, sent a letter to DNO saying that recent reports made by the Oslo Stock Exchange (OSE) had done the KRG “unjustifiable and incalculable harm”.

The dispute centres around a US$29.7 million share transaction between DNO and Genel Enerji  where the Turkish company Genel took around a 5% stake in DNO. An investigation by the OSE discovered that the KRG acted as an effective middleman through the use of a clearing account in the United Kingdom registered personally to Hawrami.

This led the OSE to accuse DNO of insider trading due to the KRG effectively becoming a DNO shareholder. Speculation was also rife both in Norway and abroad that due to the account being personal illicit personal gain could have been involved in the transaction

"All oil exports will cease and DNO shall not be entitled to any economic interest in the (Kurdish oil contracts) during the suspension period," Hawrami said in the letter published on both the DNO and KRG websites.

“The suspension period shall be for a maximum period of 6 weeks, and during which DNO, must find a ways to remedy, and to our full satisfaction, the damage done to the KRG reputation.” It added.

DNO issued a statement via its website attacking the OSE in connection with the shares and said that it had “breached its confidentiality obligations and released misleading and incomplete information.”

“The wrongful undertakings by OSE have now lead to serious consequences to DNO. DNO is now considering initiating legal actions against OSE for damages as a result of willful breach of confidentiality. The claim for damages may be substantial,” the statement added.

DNO has major interests in the Tawke oilfield in Iraqi Kurdistan.
 


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