Risk of non-recovery due to contract price adjustments and arbitration in the Ichthys LNG project
First written in FY2019-Q2. 5 of 11 entries say "Restated". Latest entry: FY2022.
The whole theme swung hardest in 2019: 3 of 7 companies on the "Worse" side.
0 other companies' latest entry also says "Achieved".
- FY2022AchievedAnnual report
「Following continued negotiations, the parties reached a final agreement dated 11 April 2022. After the consortium completed the agreed procedures, the matter was resolved through a settlement under which the JV and the consortium each withdrew the claims they had previously submitted.」
Following the settlement with the customer, the arbitration and claims involving the consortium were also resolved through a final agreement and settlement dated 11 April 2022. Meanwhile, the related loss of ¥57.5 billion was recognized in the fiscal year. - FY2022-Q3MitigatedAnnual report
「During the execution of the project, various differences of opinion arose between the JV and the customer. Although arbitration was initiated to resolve them and negotiations continued in parallel, the parties reached a final agreement dated 15 October 2021 and resolved the matter through a settlement centered on the withdrawal by both the JV and the customer of the claims they had previously submitted.」
Regarding the Ichthys LNG Project, discussions and arbitration with the customer were resolved through a settlement dated 15 October 2021, leaving arbitration with the consortium as the only remaining risk. - FY2022-Q2MitigatedAnnual report
「During the execution of the project, various differences of opinion arose between the JV and the customer. Although arbitration was initiated to resolve them and negotiations continued in parallel, the parties reached a final agreement dated 15 October 2021 and resolved the matter through a settlement centered on the withdrawal by both the JV and the customer of the claims they had previously submitted.」
Discussions and arbitration with the customer concerning the Ichthys LNG project have been resolved through a settlement. However, arbitration with the consortium and the risk of non-recovery of advance payments remain. - FY2022-Q1MaterialisedAnnual report
「In light of progress in negotiations and changes in the future outlook, we carefully reassessed the recoverability of uncollected contract amounts and other receivables. As a result, we recorded an extraordinary loss of ¥59.4 billion for the nine months ended the first quarter of the current fiscal year.」
For the Ichthys LNG project, a ¥59.4 billion extraordinary loss was recorded following a reassessment of the recoverability of uncollected contract amounts and other receivables. The previously disclosed risk of non-recovery was recognized as an actual loss. - FY2021-Q3MaterialisedAnnual report
「In early December 2020, the arbitral tribunal issued a partial award stating, among other things, that it could not at that time recognize the costs as reimbursable because deliberation was required to determine whether each additional cost qualified as an additional field subcontract cost. Following the partial award, the customer requested that the JV temporarily refund the full amount of the funding provided and, in mid-January 2021, demanded payment from us, the JV's parent company, KBR Corporation of the United States and Chiyoda Corporation under the parent guarantees each company had submitted to the customer. Our share of responsibility within the JV in relation to this payment demand is 40%, or approximately A$303 million.」
In the Ichthys LNG project, following the arbitral tribunal's partial award, the customer actually demanded a refund of the full amount of the funding provided and payment under the parent guarantees. Our share of responsibility was quantified at 40%, or approximately A$303 million. - FY2021-Q2RestatedAnnual report
「Based on the above circumstances, if discussions or arbitration between the JV and the customer or consortium produce an unfavorable outcome for the JV, some construction receivables and advances paid may become uncollectible, potentially affecting the group’s financial results and other matters.」
The risk of non-recovery arising from discussions and arbitration over contract price adjustments and additional costs in the Ichthys LNG project continues. - FY2020-Q3RestatedAnnual report
「Based on the above circumstances, if discussions or arbitration between the JV and the customer or consortium produce an unfavorable outcome for the JV, some construction receivables and advances paid may become uncollectible, potentially affecting the group’s financial results and other matters.」
The risk of non-recovery arising from discussions and arbitration over contract price adjustments and additional costs in the Ichthys LNG project continues to be disclosed. - FY2020-Q2RestatedAnnual report
「Based on the above circumstances, if discussions or arbitration between the JV and the customer or consortium produce an unfavorable outcome for the JV, some construction receivables and advances paid may become uncollectible, potentially affecting the group’s financial results and other matters.」
The risk that construction receivables and other amounts may become uncollectible as a result of discussions and arbitration over contract price adjustments and additional costs in the Ichthys LNG project continues to be disclosed. - FY2020-Q1RestatedAnnual report
「Based on the above circumstances, if discussions or arbitration between the JV and the customer or consortium produce an unfavorable outcome for the JV, some construction receivables and advances paid may become uncollectible, potentially affecting the group’s financial results and other matters.」
The risk of non-recovery arising from discussions and arbitration over contract price adjustments and additional costs in the Ichthys LNG project continues to be disclosed in the current quarter. - FY2019-Q3RestatedAnnual report
「In light of the above, if discussions or arbitration between the JV and the customer or consortium result in an outcome unfavorable to the JV, part of the construction receivables and advance payments may become uncollectible, potentially affecting the operating results and other aspects of our group's financial performance.」
Even after handover of the facilities for the Ichthys LNG project, the risk of non-recovery arising from discussions and arbitration over contract price adjustments and additional costs continues to be disclosed. - FY2019-Q2First statedAnnual report
「The plant facilities for this project were completed, and handover to the customer was completed during the six months ended the second quarter of the current fiscal year. In connection with costs incurred due to an increase in the scope of services and other factors, the joint venture has been unable to reach agreement with the customer on some amounts that should be reimbursed under the contract and some amounts for which the contract price should be adjusted, and discussions are continuing or have proceeded to arbitration. The joint venture has engaged subcontractors in place of the consortium to construct the combined-cycle power generation facilities, while filing a counterclaim against the consortium and seeking payment of the construction costs. If discussions or arbitration between the joint venture and the customer or consortium result in an outcome unfavorable to the joint venture, part of the construction receivables and advance payments may become uncollectible, potentially affecting the operating results and other aspects of our group's financial performance.」
Although the Ichthys LNG project progressed through facility completion and handover to the customer, discussions and arbitration with the customer over additional costs and contract price adjustments, as well as arbitration with the consortium, have arisen. The risk that construction receivables and advance payments may become uncollectible if the outcome is unfavorable has been newly disclosed.