Hyflux said Monday it received a letter from BNP Paribas declaring US$57.73 million due and payable in relation to claims on performance bonds made by the project company for the Magtaa desalination project in Algeria.
That followed Hyflux’s April announcement that the project company, Tahlyat Myah Magtaa, or TMM, made a demand for immediate payment from Hydrochem and Hyflux under the contract-performance guarantee, called a counter-guarantee facility, between the two companies and Arab Banking Corp.
“The company disputes TMM’s right to make such claim and is taking appropriate legal steps, including having filed an injunction application against the issuer of the performance bond that guarantees payment of claims by TMM,” Hyflux said in a filing to SGX Monday.
Hyflux said the demand from BNP Paribas would have a material impact on its financial performance.
Algerian Energy Co. (AEC) won the Magtaa contract from the government and sub-contracted it to Hyflux; TMM is a joint venture between AEC and Hyflux. Hydrochem is Hyflux’s water-treatment arm.
While you’re here, we’re hoping you can help us out.
Shenton Wire has been providing you with quick news and market analysis. Help us continue to bring you the news you’ve come to expect and to expand our reach beyond Singapore.
Your monthly contribution will directly fund our journalism.
You can check your existing account here. You can also contact us about other contribution levels or for corporate subscriptions and syndication queries.