Caerus Mineral Resources PLC (LSE:CMRS) noted that BMG Resources Ltd (ASX:BMG) has invoked the dispute resolution process with New Cyprus Copper PA Ltd (NCC), part of Caerus Mineral's Cypriot portfolio.
NCC owns a 90% interest in Treasure Development Ltd (TDL) in Cyprus and is also responsible for maintaining and progressing other Cypriot projects. ASX-listed BMG is a minority shareholder in TDL with a 10% interest.
BMG has notified NCC that it has defaulted on a A$2mln (£1.1mln) payment based upon on BMG's interpretation of an amendment to the original share purchase agreement in April 2016 between BMG, NCC and TDL, which granted BMG an option to sell its 10% stake in TDL.
BMG expressed its interest in exercising the put-option, while NCC confirmed it elected to revert to payment through a net smelter royalty on 4 July 2022, Caerus said.
Caerus added that NCC’s board maintains that the intention behind a May 2021 amendment was for NCC to retain its ability to elect to pay the balance payment via a net smelter royalty.
Caerus said it will monitor the dispute resolution and continue to provide updates to its shareholders when necessary.