Tanzania Finalizes $7 Million Payment, Concludes Wigu Hill Legal Dispute

Tanzania has finalized a $7 million payment to Montero Mining, concluding a $27 million settlement over the Wigu Hill project expropriation. The deal emerged from a lengthy dispute and averts further legal complications. Montero’s leadership expressed satisfaction with the timely resolution and is considering fund distribution options for its shareholders.

Tanzania has successfully finalized a $7 million payment to Montero Mining and Exploration Ltd, concluding a lengthy legal dispute over the Wigu Hill rare earth element project. This settlement totals $27 million, significantly less than the $70 million initially sought by Montero, following the government’s expropriation of the project. The resolution emerged from an out-of-court agreement reached in November 2023, averting a lengthy court process.

Under the settlement arrangement, payments to Montero were structured in three installments. Montero received the last $7 million payment recently, after already obtaining $12 million by November 2024, followed by additional payments of $15 million due by early 2025. This outcome spares Tanzania from potential judicial challenges and reinforces a more favorable business environment in the country.

Montero had invested around 15.5 million Canadian dollars into the Wigu Hill project since its inception in 2008. Despite prior attempts at amicable resolution, the company resorted to an investment arbitration claim with the International Centre for Settlement of Investment Disputes (ICSID), which will now officially conclude following the settlement deal.

In a statement, Montero’s President and CEO, Dr. Tony Harwood, expressed his approval regarding the settlement completion, emphasizing the importance of addressing associated costs stemming from the dispute. The company is also deliberating on methods to allocate the settlement proceeds to its shareholders, including the option of a capital return distribution, with a decision anticipated in the second quarter of 2025. Future expenses related to the dispute will be managed on Montero’s behalf.

In conclusion, Tanzania’s completion of the $7 million payment to Montero Mining marks the end of a protracted legal battle concerning the Wigu Hill project. This settlement not only resolves the dispute but also allows Montero to potentially distribute funds back to its shareholders while managing its remaining expenses. The effective resolution embodies a strategic move by both entities to navigate complex legal landscapes while fostering a cooperative business environment.

Original Source: www.thecitizen.co.tz