Karadeniz Electricity Production Inc. (Karkey), a subsidiary of Karadeniz Holding, has won $800 million in damages as a result of the lawsuit it carried out against Pakistan for the loss of rights it suffered due to Pakistan's confiscation of the company's vessels.
According to a written statement issued by the company, the International Center for Settlement of Investment Disputes (ICSID) arbitration committee ruled that the Pakistani government must pay Karkey around $800 million in compensation, including interest and loss of production, for withholding the Turkish company's four vessels, including two floating power plants, for over two years since 2012.
The statement reminded that ICSID made an interim decision on the release of the Karadeniz Powership Kaya Bey vessel which Pakistan unfairly retained in 2014, saying, "It has been ruled that Pakistan compensate for Karkey's contractual rights, including its current receivables, the repair costs and income losses of the Karadeniz Powership Kaya Bey vessel, which had been detained for some time and released later, the replacement fees and the loss of revenue of other detained vessels, and the various cost increases and costs incurred by the company as a result of Pakistan's violations. Taking into account these costs, Pakistan is going to be subjected to interest from the beginning of the unjust infringement to the day of indemnification, and pay a total of $800 million in damages including Karkey's legal expenses."
The statement also said, "We believe that the conclusion of such disputes stemming from Pakistan's internal political and administrative uncertainties and controversies that have led to the victimization of not only our company but also of various international investors in a way that will bring the least harm for friendly nations will be possible with Pakistan fulfilling its obligations under ICSID's decision as soon as possible."
On the other hand, it was also reported that in case the agreement is not reached regarding the compensation, Karadeniz Electricity Generation Inc. will initiate an execution process.
In 2013, Karkey launched an arbitration trial against the Islamic Republic of Pakistan, including the violation of the property rights of various rights and assets, including energy vessels.
The company owns the world's largest energy fleet with its 13 floating electricity generating ships, which have 2,700 megawatts of installed power, in the domestic and international energy market.
The company aims to raise its installed power on open seas to 8,000 megawatts with an additional 5,300 megawatts of energy vessels under construction. It has been operating in 15 countries, including Turkey, Indonesia, Ghana, Lebanon Mozambique, Zambia, the U.K. and the Netherlands.