This week Melbourne-based junior FAR took on one of the goliaths of the oil patch, claiming that the pre-emption window over three blocks offshore Senegal that ConocoPhillips has offered to sell to Perth's Woodside Petroleum was yet to begin.
FAR claims that ConocoPhillips has failed to abide by the terms of the joint operating agreement.
Yesterday ConocoPhillips rejected those claims and said it expected the deal to close by year-end as planned.
ConocoPhillips issued a statement saying that none of the co-venturers elected to exercise their pre-emptive rights within a 30-day window and it is seeking to progress the transaction with Woodside by seeking approval from the Senegalese government.
"ConocoPhillips believes it has provided the information required in the preferential right notification, while honouring the joint operating agreement and confidentiality clauses from preceding agreements," the Houston-headquartered company said in a statement.
Senegal's government has urged both parties to amicably resolve the issue and pave the way for revenue from what would be the nation's first offshore development.
The African nation needs to get its first offshore development right, and it fears that a legal dispute between its resource owners could drag on for months or years.
But quite what the dispute is between FAR and ConocoPhillips is only known to the people inside the tent who have read the JOA that was signed between FAR and ConocoPhillips back in 2013.
Speaking on a condition of anonymity, one lawyer who has worked on a number of JOAs said one of two things must have happened: either ConocoPhillips has completely ignored the pre-emption clause completely when making its deal with Woodside or there may be a two stage pre-emption regime in the JOA.
The first option is considered unlikely as both Woodside and ConocoPhillips have acknowledged FAR's rights.
"There might have been a pre-clearance clause around that asset, where if they were contemplating a sale, the JV partners may have said that was fine, you can go and run a competitive bid process, but you have to come back with the final terms and conditions and who the potential purchaser and then they [FAR] will have a right to exercise their pre-emption," the experienced lawyer speculated.
The JOA process is very procedural when it comes to pre-emption, both in notification and waiting times, and it was speculated there could have been something as simple as a procedural error.
Typically pre-emption windows are 30-60 days, however with some larger assets that window can be as long as 90 days.
FAR previously declined to specify how long it had to respond, but its decision to come out this week could potentially give it another month to respond.
FAR maintains the pre-emption clock has not even started ticking, but exactly what FAR plans to do is unknown.
With a market capitalisation of $A352.46 million FAR seems unlikely to be in a position to raise the $US430 million ($A563 million) to increase its 15% stake to 50% and fund half of the development, but it could use its pre-emptive right to purchase and on-sell most of ConocoPhillips' interest to a partner, if it can secure backing.
Potentially operator Cairn Energy (40%) could work with FAR to buy out ConocoPhillips, and last week Cairn was bullish on the potential for the development of SNE and the surrounding exploration upside.
RBC Capital Markets analyst Ben Wilson said that it was reasonable to assume at a minimum, FAR was considering pre-empting the transaction.
The SNE field has 2C contingent resources of around 641 million barrels, with 3C upside to more than 1.2Bbbl.
Woodside says the issue is between FAR and ConocoPhillips, but the company hopes to close the deal by the end of the year.
FAR's spat with ConocoPhillips comes at a time when there is a similar fight over Marindi Metals $21 million purchase of the Reward zinc-lead project in the Northern Territory.
Seller Rox Resources had two willing buyers, with Marindi coming out on top with the highest offer.
However, under the 2013 joint venture agreement with Canadian resources house Teck Resources, Rox was obliged to offer to sell its interest in the project to Teck on the same terms and conditions.
Teck has written to Rox setting out some concerns with respect to the offer and its compliance with the JV agreement and has reserved its rights, so Rox has entered into discussions with Teck to clarify the matters.
"It is interesting that people are now paying attention to pre-emption rights at the moment," one lawyer said.