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Churchill Mining Plc (“Churchill” or “the Company”) listed on the Alternative Investment Market (AIM) of the London Stock Exchange in April 2005. Churchill’s growth path accelerated following the discovery of a world-class thermal coal deposit in the East Kutai Regency of Kalimantan (“EKCP”), Indonesia following an intensive and...Read more
Churchill Mining files new formal letter to Indonesia president in East Kutai coal project disputeMay 04 2012, 8:20am
Churchill Mining (LON:CHL) has filed a further formal letter to the President of Indonesia, seeking support and legal protection in order to achieve an amicable and commercial resolution to the dispute regarding the East Kutai coal project (EKCP), 75 per cent owned by Churchill.
It told investors that the letter highlights the company's investment in Indonesia and the subsequent actions of various Indonesian parties, both government and private, aimed at expropriating its legitimate rights to develop the project.
Churchill believes these actions to be in direct breach of both Indonesian law and Indonesia's obligations under the Bilateral Investment Treaty between the United Kingdom and the Republic of Indonesia.
The letter follows initial formal correspondence in November 2011 and also the recent notations on the Indonesian Supreme Court's register of cases, that indicates the Supreme Court intends to reject the appeal by Churchill/Ridlatama in relation to the revocation of the four mining licenses that comprise the EKCP.
Chairman David Quinlivan said: "We are determined to continue to seek a full and legitimate remedy for our shareholders and have provided the opportunity for government intervention to protect our rights as a foreign investor in Indonesia."
The firm has been entrenched in a legal battle against the Indonesian government for the past year. The case has put the future of the US$1.8 billion East Kutai coal mine development project in the balance.
Churchill continues to prepare its arbitration claim against Indonesia for direct breaches of the country’s obligations under the abovementioned treaty.
As previously advised the company will file its claim at the International Centre for Settlement of Investment Disputes in Washington in late May 2012.
The chairman told Proactive Investors last month that the total cost of a prolonged arbitration process could be in excess of US$5 million, and that Churchill currently has over US$13 million in the bank.
“At the moment we have sufficient funds (to cover the arbitration process). If it is going to turn into a long litigation case we would scale back and regroup.
"We’ve had estimates from our legal team about how much a long drawn out case would cost, and we’ve certainly got more than enough to last three to four years.”