Jul 8, 2021

Cairn Energy freezes Paris assets in India tax dispute

CairnEnergy
Oil
arbitration
Paris
Dominic Ellis
3 min
A French court has authorised Cairn Energy's application for an asset freeze that would transfer ownership of 20 Paris properties according to reports

Cairn Energy has escalated its tax dispute with the Government of India by freezing Indian state-owned property in Paris, according to the Financial Times.

It reports a French court has authorised the Edinburgh-based oil producer's application for an asset freeze that would transfer ownership of 20 Paris properties, valued at over €20 million, from the Indian government to the company.

Cairn received notice at the end of March that the Government of India has petitioned the Dutch Court of Appeal to set aside the arbitration award, that was dated December 21 2020 - and two days later, Cairn announced that the tribunal established to rule on its claim against the Government of India "had found unanimously in Cairn's favour".

Delivering an AGM statement in May, Simon Thomson (pictured), Chief Executive of Cairn Energy, said: "In December last year the tribunal established to rule on our claim against the Government of India found in Cairn’s favour and awarded us damages of $1.2bn plus interest and costs. This ruling is binding and enforceable under international treaty law. Whilst India has sought to challenge the basis of the award through set-aside proceedings in the Dutch courts, we remain confident of our position and continue constructive engagement with the Government of India whilst at the same time taking all necessary actions to protect our rights to the award and access the value of it as early as possible."

Cairn has taken this latest step after failing to receive the damages, plus interest and costs, according to Alliance News, quoting the newspaper, and has identified $70 billion in worldwide assets that it may attempt to seize as long as the Indian government refuses to pay.

Cairn's claim was brought under the terms of the UK-India Bilateral Investment Treaty, the legal seat of the tribunal was the Netherlands and the proceedings were under the registry of the Permanent Court of Arbitration. The tribunal ruled "unanimously that India had breached its obligations to Cairn under the UK-India Bilateral Investment Treaty and that compensation was due", it states.

Addressing the jurisdiction of the arbitration, the tribunal ruled that the dispute was within the scope of the Treaty and other relevant legal parameters. It further ruled that the application to Cairn of the retrospective tax amendment introduced by the GoI was “grossly unfair” and in breach of the “Fair and Equitable Treatment" standard of the Treaty, according to Cairn.

The dispute between Cairn Energy and the Indian government stretches back to early 2014, when the Indian government froze Cairn Energy's 10% stake in Cairn India following the introduction of retrospective tax legislation.

A video posted on its website in 2019 celebrates 10 years since the first oil was drilled from Mangala oil field, Rajasthan. The commentary states: "The changes inspired by Cairn have inspired business opportunities and investment for local communities and the jobs and social programmes created here will sustain the desert people of Barmer for years to come."

In March, Cairn announced with Cheiron, the proposed acquisition of Shell’s Western Desert assets for $646 million ($323 million net to Cairn), with additional contingent consideration of up to $280 million ($140 million net to Cairn), dependent on certain requirements, which is due to complete in the second half of 2021. Following the sale of interests in Senegal, it returned $250 million to shareholders.

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Jul 26, 2021

Form Energy receives funding power for iron-air batteries

Energy
batteries
grid
Renewables
Dominic Ellis
3 min
Startup Form Energy receives $200 million Series D financing round led by ArcelorMittal’s XCarb innovation fund to further develop iron-air batteries

Form Energy believes it has cracked the conundrum of commercialising grid storage through iron-air batteries - and some of the biggest names in industry are backing its potential.

The startup recently announced the battery chemistry of its first commercial product and a $200 million Series D financing round led by ArcelorMittal’s XCarb innovation fund. Founded in 2017, Form Energy is backed by investors Eni Next LLC, MIT’s The Engine, Breakthrough Energy Ventures, Prelude Ventures, Capricorn Investment Group and Macquarie Capital.

While solar and wind resources are the lowest marginal cost sources of electricity, the grid faces a challenge: how to manage the multi-day variability of renewable energy, even in periods of multi-day weather events, without sacrificing energy reliability or affordability.

Moreover, while Lithium-ion batteries are well suited to fast bursts of energy production, they run out of energy after just a few hours. Iron-air batteries, however, are predicted to have theoretical energy densities of more than 1,200 Wh/kg according to Renaissance of the iron-air battery (phys.org)

The active components of Form Energy's iron-air battery system are some of the cheapest, and most abundant materials: iron, water, and air. Iron-air batteries are the best solution to balance the multi-day variability of renewable energy due to their extremely low cost, safety, durability, and global scalability.

It claims its first commercial product is a rechargeable iron-air battery capable of delivering electricity for 100 hours at system costs competitive with conventional power plants and at less than 1/10th the cost of lithium-ion and can be optimised to store electricity for 100 hours at system costs competitive with legacy power plants.

"This product is our first step to tackling the biggest barrier to deep decarbonisation: making renewable energy available when and where it’s needed, even during multiple days of extreme weather, grid outages, or periods of low renewable generation," it states.

Mateo Jaramillo, CEO and Co-founder of Form Energy, said it conducted a broad review of available technologies and has reinvented the iron-air battery to optimise it for multi-day energy storage for the electric grid. "With this technology, we are tackling the biggest barrier to deep decarbonization: making renewable energy available when and where it’s needed, even during multiple days of extreme weather or grid outages," he said.

Form Energy and ArcelorMittal are working jointly on the development of iron materials which ArcelorMittal would non-exclusively supply for Form’s battery systems. Form Energy intends to source the iron domestically and manufacture the battery systems near where they will be sited. Form Energy’s first project is with Minnesota-based utility Great River Energy, located near the heart of the American Iron Range.

Greg Ludkovsky, Global Head of Research and Development at ArcelorMittal, believes Form Energy is at the leading edge of developments in the long-duration, grid-scale battery storage space. "The multi-day energy storage technology they have developed holds exciting potential to overcome the issue of intermittent supply of renewable energy."

Investors in Form Energy's November 2020 round included Energy Impact Partners, NGP Energy Technology Partners III, and Temasek.

In May 2020, it signed a contract with Minnesota-based utility Great River Energy to jointly deploy a 1MW / 150MWh pilot project to be located in Cambridge, MN. Great River Energy is Minnesota's second-largest electric utility and the fifth largest generation and transmission cooperative in the US.

Last week Helena and Energy Vault announced a strategic partnership to identify additional opportunities for Energy Vault’s waste remediation technologies as the company begins deployment of its energy storage system worldwide. It received new investment from Saudi Aramco Energy Ventures (SAEV) in June.

Maoneng has revealed more details of its proposed 240MWp / 480MWh Battery Energy Storage System (BESS) on Victoria’s Mornington Peninsula in Australia (click here).

The BESS represents hundreds of millions of dollars of investment that will improve electricity grid reliability and network stability by drawing energy from the grid during off-peak periods for battery storage, and dispatching energy to the grid during peak periods. 

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