Canacol Energy Ltd Provides Information on Arbitration Process

Core Points - Canacol Energy Ltd. has been notified of a decision from domestic arbitration proceedings initiated by VP Ingenergía S.A.S. E.S.P. regarding the termination of three natural gas supply contracts [1][2] - The arbitration examined Canacol's termination of contracts due to VP Ingenergía's breaches, including failure to provide guarantees and pay for delivered gas [2] - The arbitral tribunal ruled that Canacol must pay approximately USD $22 million, while also recognizing Canacol's valid termination of contracts [3] Summary by Sections Arbitration Decision - The tribunal accepted Canacol's arguments about the invalidity of guarantees from VP Ingenergía and the mishandling of gas sale proceeds, but partially upheld VP Ingenergía's claims related to force majeure events [3] - The decision is subject to clarification and will become binding on November 20, 2025 [3] Financial Implications - Canacol is reviewing the arbitration decision in light of outstanding invoices owed by VP Ingenergía, totaling approximately USD $25 million [4] - Canacol is pursuing an international arbitration claim against VP Ingenergía for amounts exceeding USD $76 million, with no counterclaims from VP Ingenergía [5] Legal Actions - The domestic arbitral decision will be submitted to the Office of the Attorney General of the Nation, highlighting breaches of good faith by VP Ingenergía [6] - Criminal charges have been filed against VP Ingenergía's directors for offenses including aggravated fraud and corruption [6] Future Actions - Canacol is considering potential appeals or legal actions based on the arbitral decision and continues to rely on the Colombian justice system [7]