Case Note on PetroTrans Company Ltd. v. Ministry of Mines of the Federal Democratic Republic of Ethiopia

In January 2016, an international arbitral tribunal seated in Switzerland and comprised of three members from Switzerland, France, and the United States rendered its final award in the case of PetroTrans Company Ltd. v. Ministry of Mines of the Federal Democratic Republic of Ethiopia. PetroTrans commenced the arbitration in late 2012 under the auspices of the International Chamber of Commerce (ICC) after the Ministry terminated five petroleum production sharing agreements (PSAs) that had been awarded in 2011 to explore and develop petroleum resources in southeastern Ethiopia. PetroTrans accepted several time-sensitive obligations under the PSAs, including an obligation to provide or arrange a loan for the Ethiopian government to be repaid from the government’s share of proceeds under the PSAs. After PetroTrans failed to obtain the loan and to fulfill other obligations, the Ministry terminated all five PSAs.