Electromagnetic Geoservices ASA (EMGS) reported that the Court of Appeal in London has ruled in favor of EMGS in a patent dispute launched by Schlumberger, where Schlumberger sought to invalidate two of EMGS's basic method patents. Today's decision overturns a ruling by the High Court in London handed down on 19 January 2009. Consequently, the two method patents are confirmed valid in the UK.

EMGS has been awarded its costs of the appeal in full and majority of its costs at first instance, the total figure for which will be determined by the Court if not agreed between the parties. In the meantime, Schlumberger has been ordered to make an initial payment on account of these costs to EMGS of £2.3 million (USD 3.5 million).

The Court of Appeal has refused Schlumberger permission to appeal to the Supreme Court.

Roar Bekker, EMGS chief executive officer, commented, "We welcome the decision by the Court of Appeal, which confirms that EMGS was the inventor of the marine EM method to detect hydrocarbon reservoirs beneath the seabed.

"The commercial value of our patents is demonstrated through the fact that most of our contracts are won through direct award. Going forward, we expect that today's ruling will reinforce this trend and may also result in multi-client exclusivity in certain countries."

EMGS has a broad portfolio of patents and patent applications relating to EM technology. The two EMGS method patents that were upheld in today's ruling by the Court of Appeal are basic to EM surveying and a prerequisite to perform 3D EM acquisition in jurisdictions where EMGS holds the patents. These patents have been granted in 24 jurisdictions.

Commenting on today's decision and recent developments, Bjarte Bruheim, Chairman of EMGS's Board, said:

"This decision provides further momentum for EMGS's 3D products and services. Recent developments, spearheaded by the PEMEX contract and underpinned by our advanced 3D EM technology and purpose-built vessels, demonstrates that the company is delivering on its strategy.

"We will continue to manage our patent portfolio and defend our basic method patents in the interest of our shareholders and other stakeholders. Furthermore, EMGS is, as a part of its ongoing strategy to exploit fully the commercial potential created by our unique technology, reviewing the company's options with regard to licensing its technology to third parties."

Tags: EMGS, Schlumberger