Romanian Frank Timis seeks compensation of USD 385 M from Burkina Faso Gov’t in mining dispute

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Three companies, belonging to Romanian businessman Frank Timis and controlled via Pan African Minerals Group, are seeking USD 385 million from Burkina Faso, accusing it of blocking development of one of the world’s biggest manganese mines.

According to an arbitration request addressed to the International Chamber of Commerce’s International Court of Arbitration and seen by Reuters, the complaint stems from a dispute over the Tambao deposit in the northeastern corner of the West African nation.

Burkinabe authorities did not want to comment this issue.

Timis’s Pan African Burkina Limited (PAB) acquired the rights to Tambao, which it says holds 100 million tonnes of manganese reserves, in June 2012 and says it has invested over USD100 million in its development.

However, the government of Burkina Faso’s longtime ruler Blaise Compaore, which agreed the deal, was overthrown two years later and in January 2015 the new authorities suspended the company’s export permit, saying some licences had been previously awarded in an opaque manner.

Though the suspension was lifted in December 2015, PAB and co-plaintiffs Pan African Minerals Burkina and Pan African Tambao accuse the government of blocking the project and seeking to expropriate the permit.

PAB filed a request for mediation with the Arbitration, Mediation and Conciliation Centre of Ouagadougou, as required under the Tambao deal, on October 27, the document said.

If mediation in Burkina Faso fails, the plaintiffs requested a final judgment from the court. They are also requesting Burkina Faso pay expenses incurred during the arbitration process.

A source familiar with the proceedings said the firms would also be seeking compensation for loss of profit, taking the total amount sought from Burkina Faso to over USD 4 billion.

According to Reuters’ sources, under the terms of PAB’s agreement with Burkina Faso, manganese from Tambao was to be transported by railway.

But PAB said Burkina Faso had not fulfilled its obligation to arrange for the renovation of an existing rail line from the town of Kaya to Abidjan in neighboring Ivory Coast. Without it, PAB said it could not begin construction of a rail spur from Kaya to Tambao.

When the plaintiffs requested permission to instead export its manganese, including 40,000 tonnes of ore mined before the suspension, by road, they said the government responded that was not allowed under the agreement.



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