The Court of Appeal for Ontario has upheld the trial judgment of Madam Justice Kathryn Feldman awarding Oceanic Exploration Company, a Colorado corporation, in excess of US$6.1 million against Denison Mines Limited. The oil exploration and development rights in issue had been purchased by Denison from Oceanic in return for an ongoing “Net Earnings Interest” to be computed in accordance with a specified formula. The elements of that formula were based on the financial provisions of the underlying agreement between the Government of Greece and the holders of the exploration and development rights. The Court of Appeal agreed with Oceanic that the computation of the Net Earnings Interest payable to it by Denison was unaffected by amendments to the underlying agreement between Greece and the consortium led by Denison, notwithstanding the fact that those amendments affected the elements of the Net Earnings Interest formula.
Oceanic was represented at trial and on appeal by Joseph M. Steiner and Donald D. Hanna of Osler, Hoskin & Harcourt LLP. Denison was represented at the Court of Appeal by Robert P. Armstrong, Q.C., and Jane S. Bailey of Torys.