FAR Limited (ASX: FAR) is facing a US$6,029,899 claim from Woodside Energy (Senegal) BV relating to the 2021 sale of FAR’s interest in the RSSD Project. Woodside asserts that the Senegal Ministry of Energy, Petroleum and Mines has made a final decision preventing Woodside from recovering certain petroleum expenditure not directly linked to exploration activities. Woodside has demanded payment from FAR within 14 days.
This claim follows an earlier announcement on January 31, 2025, where FAR disclosed a potential indemnity obligation to Woodside up to a maximum of US$6,803,355 for similar unrecoverable petroleum expenditure, with the possibility of a claim exceeding this amount. According to the Sale and Purchase Agreement, this indemnity obligation is contingent upon Woodside providing written notice of the claim with detailed information before the first anniversary of first oil being sold, a deadline that is rapidly approaching.
FAR has stated that it has been actively seeking more information from Woodside regarding the potential claim but critical information is still outstanding. The company has explicitly reserved all rights under the Sale and Purchase Agreement and has not acknowledged liability to Woodside regarding this matter. The disagreement centers on the interpretation and application of indemnity clauses within the original sale agreement and whether the expenditure in question falls under FAR’s obligations.
