Montero Mining has received the final US$7 million payment from Tanzania, concluding a long dispute over the Wigu Hill project. The US$27 million settlement was reached out of court, reducing Montero’s original claim of US$70 million. The company will now assess options for distributing funds to shareholders after covering associated legal costs.
Montero Mining and Exploration Ltd. has successfully concluded the final payment of US$7 million from the Tanzanian government, thereby settling a long-standing dispute concerning the Wigu Hill rare earth element project. This settlement totals US$27 million and resolves a legal battle stemming from the government’s expropriation of the project.
The contentious dispute, which began when Tanzania seized control of Wigu Hill, was amicably settled out of court in November 2023 through an agreement between Montero and the Tanzanian government. Initially, Montero sought US$70 million in compensation, but the settlement amount negotiated was approximately 39% of that figure.
The financial terms of the settlement outlined that Tanzania would pay Montero in three installments: US$12 million by November 2024, followed by US$15 million in two subsequent payments due in January and February 2025, with the final payment scheduled for March 4, 2025. This agreement not only ends the legal conflict but also mitigates the risk of a lengthy court process.
Since its inception in 2008, Montero had invested roughly 15.5 million Canadian dollars in the Wigu Hill project. Despite numerous attempts for an amicable resolution, Montero proceeded to file an investment arbitration claim with the International Centre for Settlement of Investment Disputes (ICSID), a claim that will now be formally withdrawn.
Dr. Tony Harwood, Montero’s President and CEO, expressed his satisfaction regarding the timely receipt of the final payment from Tanzania, emphasizing the company’s readiness to address the financial implications of the settlement, including legal costs.
Montero is currently contemplating how to allocate the settlement funds to its shareholders, including potential capital distribution. A definitive decision will emerge following a thorough review of legal and administrative expenses, with an announcement expected in the second quarter of 2025. Additionally, a portion of the settlement funds will be retained to cover any outstanding expenses associated with the dispute, which Montero will manage moving forward. Efforts to reach Tanzanian government officials for commentary were unsuccessful.
The successful conclusion of the settlement between Montero Mining and Tanzania regarding the Wigu Hill project effectively resolves a protracted legal dispute. The agreed payment of US$27 million, significantly lower than the original claim, ensures that both parties can move forward without the burden of further legal proceedings. Montero is now evaluating its next steps concerning shareholder distributions from the settlement proceeds, while still preparing for any leftover administrative obligations related to the dispute.
Original Source: africanminingmarket.com
