Montero Mining and Exploration Ltd (TSX-V:MON) has announced that a dispute resolution process dealing with the expropriation of its Wigu Hill rare earth element project in Tanzania is now underway.
The Toronto-based exploration company said the International Centre for Settlement of Investment Disputes (ICSID) arbitration tribunal was constituted on 18 November 2021 signalling that the process initiated by Montero to protect its investment and exploration rights in Tanzania will now proceed.
Montero’s Wigu Hill Rare Earth Element Retention License was expropriated by the Tanzanian government in 2018 when the Mining Regulations 2018, published on 10 January 2018, cancelled all previously issued Retention Licenses. The company commenced exploration activities on the project in March 2008 under a prospecting license, before obtaining a five-year retention license for the property in 2015.
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“Acting in good faith, Montero made several attempts to settle the dispute over Wigu Hill with the Tanzanian government but without success. Therefore, I am pleased that the legal proceedings are now underway,” Montero president and CEO Tony Harwood said in a statement.
“Montero is claiming damages as compensation for the loss of the project since the company’s discovery and development of the rare earth deposit has created significant value for Tanzania.
“Our legal counsel is confident that the process will have a positive outcome for the company, and we will provide regular updates on the progress of the arbitration proceedings.”
Montero said it filed a request for arbitration with the ICSID on 8 January 2021. Subsequently, on 9 February 2021, ICSID registered the company’s request for the institution of arbitration proceedings to resolve the illegal expropriation matter.
The company initiated international arbitration proceedings through ICSID in accordance with the Bilateral Investment Treaty between Canada and Tanzania which protects investment rights. It said it seeks compensation based on the damages it suffered from the Tanzanian government’s acts and omissions.
It noted that the arbitration tribunal is composed of Achille Ngwanza, who will act as president, Eric Teynier, an arbitrator appointed by Montero and Cecil Abraham, an arbitrator appointed by the government of Tanzania.
ICSID requires that each party to the dispute make a deposit of US$150,000, after which a first hearing to establish the procedural calendar for the proceedings will be held within 60 days.
Harwood said Montero is standing up for mining and investment rights in Tanzania to protect its investors and help promote a sound investment climate.
“While we are pursuing this claim for damages, the company has divested from Africa to focus on the exploration and development of its gold-silver and copper metals projects in Chile, a tier 1 mining investment destination,” he concluded.
Montero said it is not permitted to comment on the potential quantum of any claim for compensation for damages at this point. It has obtained dispute funding from Omni Bridgeway, a leading global dispute funder.
The company said it has retained as legal counsel Thierry Lauriol and his team at Jeantet AARPI, who is highly experienced in international arbitration and has an excellent track record of achieving successful outcomes for clients in Africa.
It has also retained the services of Neal Rigby of SRK Denver who will perform a valuation of Wigu Hill as an independent technical expert. Rigby has acted in this capacity in many international mining disputes that have been resolved through ICSID arbitrations, Montero said.
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