Panthera Resources PLC (AIM:PAT) said its Australian subsidiary has issued a notice of dispute with India for breaching its obligations under the Australia-India bilateral investment treaty.
Following the delivery of the notice by subsidiary Indo Gold Pty (IGPL), if no meaningful correspondence is subsequently received from the government of India or no amicable settlement reached, the company said IGPL expects to deliver a notice of arbitration to the government during this current quarter.
This would require an arbitration tribunal to be set up within two months, according to the 1999 treaty.
The dispute arose after the rejection of a prospecting licence made by wholly owned IGPL subsidiary Metal Mining India (MMI) for the Bhukia project, where Panthera says it owns legal rights and has invested substantial funding and carried out approved work programmes since 2004.
In September, the High Court of Rajasthan dismissed IGPL's writ petition.
Previously, the Times of India reported that the gold deposit at Bhukia could be worth over US$1 billion, based on information from the Geological Survey of India, though the valuation has not been independently verified by the company.
Panthera said it will announce the quantum of damages that IGPL will claim from India “when available”.