Blue Power Group Sarl and others v Eni Norge AS and others

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Practice – Summary judgment. The claimants’ application for summary judgment in a claim relating to the potential transportation of compressed natural gas failed, as it was premature to conclude that there would be no further relevant evidence to come. The Chancery Division further struck out parts of the pleading that appeared to claim loss of profits for breach of best endeavours. The claimants would be required to provide a response to the defendants’ request for further information.

 

Background

The claimant associated companies conducted business of research, development and engineering of technologies in the energy sector. The defendant companies were an Italian oil multinational and two of its subsidiaries. The proceedings arose out of a project relating to the potential transportation of compressed natural gas (CNG) from an oil and gas field in the Barents Sea called Goliat. The first defendant was the operator and majority licence-holder for Goliat: the minority licence interest was held by a Norwegian oil company (Statoil).

The defendants needed to find and implement a solution for dealing with and/or exploiting the gas released at the Goliat offshore floating platform. To that end, from early 2010, certain of the parties entered into agreements, including an exclusive framework agreement (the EFA) in March 2010.

The defendants and Statoil implemented a solution involving the reinjection of gas at the Goliat offshore platform. The CNG export project was terminated because Statoil refused to give its consent to it. The claimants commenced proceedings, including a claim against the first defendant for breaches of obligations in the EFA to use its best endeavours to obtain Statoil’s consent to the CNG project and/or to promote the CNG option to Statoil, together with breaches of related obligations to keep the claimants informed about various matters. The first defendant (ENI) contended that, first, it should be granted summary judgment, as the claimants had no real prospect of success because there had been no real chance that Statoil would have consented to the continuation of the CNG project in any event. Second, it contended that the claimants’ only possible claim was for the loss of a chance of additional profits, so the alternative claim for loss of profits should be struck out.

Issues and decisions

(1) Whether there was a realistic prospect of the claimants being able to establish at trial that Statoil could have been persuaded to consent to the continuation of the CNG project if ENI had taken as yet unidentified steps.

On the evidence, it was not possible to say that there was no realistic prospect of the claimants being able to establish at trial that Statoil could have been persuaded to consent to the continuation of the CNG project if ENI had taken as yet unidentified steps. The principal difficulty was that there was no evidence from the actual decision-makers at Statoil (see [54], [55] of the judgment).

It was conceivable that disclosure would shed further light on Statoil’s decision-making as it had been revealed to the defendants (see [57] of the judgment).

In short, it was premature to conclude, at the present stage, that there would be no further evidence, either documentary or oral, that would have a bearing on Statoil’s decision-making process (see [59] of the judgment).

Three Rivers District Council v Bank of England [2000] 3 All ER 1 considered; Equitable Life v Ernst & Young [2003] PNLR 16 (CA) considered; Shah v HSBC Private Bank (UK) Ltd [2010] 3 All ER 477 considered; Tesco Stores Ltd and others v Mastercard Incorporated and others [2015] All ER (D) 195 (Apr) considered; Wellesley Partners Llp v Withers Llp [2015] All ER (D) 146 (Nov) considered.

(2) Whether the claim should be struck out in relation to the claim for loss of profits.

It was common ground that the claimants could not claim loss of profits for the breach of the best endeavours obligation. It was important that the pleading accurately reflected the claims being pursued. Accordingly, the parts of the pleading which appeared to claim loss of profits for best endeavours would be struck out. That could be addressed by a minor amendment. Consequently, the application for summary judgment in respect of the claim relating to the breach of the obligation to use best endeavours would be struck out, but would be allowed in relation to the pleading point (see [71], [72] of the judgment).

(3) Whether the claimants should provide a response to a request for further information, as contended by the defendants.

The defendants were entitled to know what facts and matters, already within the claimants’ knowledge and dependent on disclosure, the claimants relied upon. Accordingly, the claimants would be directed to provide a response to the request for further information by mid-September 2018 (see [81], [82] of the judgment).