ASX-listed Antilles Gold chairperson Brian Johnson on Tuesday expressed the company’s disappointment with the tribunal of the International Centre for Settlement of Investment Dispute’s (ICSID’s) arbitration award related to the Las Lagunas gold tailings project in the Dominican Republic.
Having rejected EnviroGold Lagunas’ (EVGLL’s) principal claim of $15.5-million, the ICSID awarded the Antilles subsidiary $4.07-million, including interest to April 24.
The principal claim related to additional costs and reduced gold production that resulted from Dominican’s failure to meet its contractual obligation to provide a site for the construction of a tailings storage facility into which reprocessed tailings could be deposited.
As a consequence, the reprocessed tailings had to be redeposited back into the Las Lagunas dam behind substantial rock retaining walls at a considerable cost.
The tribunal found that EVGLL had preferred to redeposit the reprocessed tailings back into the dam, and despite acknowledging the State’s breach of contract, ruled that EVGLL had effectively waived the State’s obligation to provide a site for the construction of a new dam.
Antilles noted that a positive element of the award was that the tribunal ordered the State to compensate EVGLL for EVGLL’s entitlement to a special compensatory and fiscal regime, and to lift garnishments that have prevented EVGLL from selling plant and equipment stored at Las Lagunas since October 2019, and to not reimpose them.
This will allow EVGLL to sell about A$3-million to A$4-million of surplus assets.
“The tribunals’ reasons for rejecting the main claim are difficult to comprehend, but there is no right of appeal. The company would not have expended so much time and money on arbitration of this claim if the
board, and its legal advisers, had not thought it to be both genuine and justified,” said Johnson.
Antilles noted that the A$6.3-million awarded to EVGLL would assist the group to fund the outstanding $2-million of its farm-in to a 50% shareholding in Cuban joint venture company Minera La Victoria, and the development of its first project, the Neuva Sabana gold/copper mine.