July 5, 2013 / 7:22 AM / 4 years ago

Petroceltic says starts legal proceedings against two companies

2 Min Read

July 5 (Reuters) - Petroceltic International Plc said it started legal proceedings against two parties with whom the company's previous board had entered into service and consultancy agreements related to its North African business activities.

The Irish oil and gas company said it had initiated the legal action in the High Court of Ireland after receiving correspondence threatening legal proceedings against it from one of the parties seeking payment of $3.4 million.

The agreements, dating back to 2004 and 2005, contain provisions under which the parties could make claims for further material payments from the company, Petroceltic said in a statement.

Petroceltic, whose operations are focussed on North Africa, and the Mediterranean and Black Sea regions, said it believed that the original agreements constituted a fraud on the company and had issued legal proceedings to have them declared void.

Shares in the company were down about 2 percent at 132.5 pence in early trading on Friday on the London Stock Exchange.

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