There has been a lot of discussion about the value of Zenith’s upcoming two arbitration claims (totalling $633 million), with some arguing the amounts are unrealistic and unlikely to be awarded. However, my own opinion, plus the precedent of two other major arbitration cases suggests otherwise.

Two major arbitration cases in recent years demonstrate that claims of this nature are not only legitimate but have also resulted in substantial awards are those announced by the public companies Rockhopper and GreenX.


Rockhopper vs Italy – Ombrina Mare – awarded €190 million ($198.8 million)


Ombrina Mare Background

• 2005: Mediterranean Oil and Gas (later acquired by Rockhopper) was granted an exploration permit for Ombrina Mare.

• 2008: The company confirmed oil reserves and applied for a production concession.

• 2010: Italy passed a law banning offshore oil exploration within 12 miles of the coast.

• 2012: An exemption allowed Ombrina Mare to proceed.

• 2014: Rockhopper acquired Mediterranean Oil and Gas.

• 2015: The ban was reinstated without exemptions, leading to the denial of Rockhopper’s concession.

• 2017: Rockhopper initiated arbitration under the Energy Charter Treaty (ECT), originally seeking €275 million.

• 2022: The arbitration tribunal ruled in favour of Rockhopper, awarding €190 million plus interest (EURIBOR +4%), bringing the total close to €250.5 million.



Arbitration Process and Key Findings


The arbitration was conducted under the ICSID (International Centre for Settlement of Investment Disputes) under the Energy Charter Treaty (ECT).

Rockhopper successfully demonstrated that while Italy’s policy change banning offshore exploration was legal, the withdrawal of Ombrina Mare’s exemption was a violation of the ECT. The tribunal acknowledged that the investment was made under the expectation of continued operation, and the abrupt removal of rights amounted to unfair treatment.

Rockhopper argued that it had invested significant capital in the project, expecting that the exemption granted in 2012 would remain valid. The tribunal found that Italy’s decision to revoke the exemption, while maintaining the broader legal framework, led to direct and unjust damages for Rockhopper. The tribunal also recognized that Rockhopper had secured financing and technical expertise to move into the production phase, further substantiating its claim for damages.

The final award, including interest, reflects the project’s estimated lost profits had the concession been granted.