A Slovenian court has approved a bankruptcy application by Geoenergo, a company that entered a joint venture with Ascent Resources to extract gas in the northeast of the country, despite its British partner's appeal to prevent the procedure.

As Geoenergo's creditor and partner, Ascent Resources had asked the court to prevent the insolvency proceedings, but the Murska Sobota District Court rejected the request, approving the bankruptcy application on 19 January.

Creditors now have until 19 April to report their claims, it follows from a filing on AJPES, the agency for legal records.

Based in Lendava, Geoenergo is co-owned by two Slovenian energy companies, Petrol and Nafta Lendava. Its main line of business is research and extraction of crude oil and natural gas in northeast Slovenia. The company entered a joint venture with Ascent Resources to extract gas by fracking in Petišovci.

Geoenergo filed the application to enter insolvency on its own. On 8 January, Ascent Resources filed an appeal trying to persuade the court that Geoenergo was solvent and was trying to abuse insolvency legislation to avoid Ascent's claims.

However, the court said the creditor lacked standing to challenge the insolvency. If the debtor is not insolvent, the creditor will be fully repaid in the receivership proceedings, it added.

Ascent Resources has been in dispute with Slovenia over a permit to extract gas in Petišovci for many years.

The dispute started in March 2019, when the Environment Agency said an environment impact assessment must be carried out before a permit could be issued. Slovenia later banned fracking altogether in 2022.

The UK company went on to open arbitration procedure against the state at the International Centre for Settlement of Investment Disputes, arguing that by preventing it from extracting gas in Petišovci, Slovenia caused it over €500 million in damage.