Kazakhstan Rescinds $54.5 Million Arbitration Award to World Wide Minerals Ltd.

Kazakhstan has annulled the $54.5 million arbitral award to World Wide Minerals Ltd. regarding a uranium processing project. This marks the second cancellation of the award in a dispute that began in the late 1990s due to regulatory interventions leading to WWM’s operational suspension. The case emphasizes the difficulties foreign investors may face in Kazakhstan’s mining sector, especially in uranium extraction.

Kazakhstan has officially rescinded the $54.5 million arbitral award granted to World Wide Minerals Ltd. (WWM), a Canadian junior mining company. This revocation pertains to a contested uranium processing project that has been subject to legal disputes for over twenty years.

The protracted conflict began in the late 1990s when WWM invested in Kazakhstan’s uranium sector, taking charge of a major uranium-processing facility. The company entered into significant agreements with the Kazakh government, aiming to enhance the nation’s uranium processing capabilities.

However, the situation deteriorated as the Kazakh authorities withdrew essential licenses and imposed bureaucratic obstacles, resulting in the cessation of WWM’s operations and the confiscation of its assets. In October 2019, an international tribunal ruled that Kazakhstan had violated international law and the Canada-USSR Bilateral Investment Treaty, awarding WWM over $40 million in damages alongside additional legal costs.

Kazakhstan contested this ruling, leading to the English High Court’s decision in November 2020 to annul parts of the arbitral award. The court sent the issues regarding causation and loss quantification back to the tribunal for further examination. This latest annulment highlights the challenges faced by foreign investors within Kazakhstan’s mining industry, especially in the uranium sector.

The revocation of the $54.5 million arbitral award by Kazakhstan reflects ongoing legal challenges and the complexities faced by foreign investors in the country’s mining sector. With the dispute extending over two decades, the situation signifies a cautionary tale regarding investment uncertainties, particularly within Kazakhstan’s uranium industry. This development reiterates the need for clarity and stability in investment regulations to attract and maintain foreign investment in the nation’s mining ventures.

Original Source: www.mining.com