Montero Mining Concludes Settlement with Tanzania Over Wigu Hill Project

Montero Mining has received a final payment of US$7 million from Tanzania, concluding a dispute over the Wigu Hill project. The US$27 million settlement resolves a long legal battle and comes after Montero initially sought US$70 million. The agreement allows for shareholder consideration of the settlement funds post-assessment of financial obligations.

Montero Mining and Exploration Ltd. has confirmed the successful completion of a final payment of US$7 million from the Tanzanian government, marking the end of a dispute over the Wigu Hill rare earth project. This settlement of US$27 million resolves a prolonged legal battle that began when the Tanzanian government expropriated the project.

The settlement, finalized out of court in November 2023, comes after an agreement where Montero originally sought US$70 million. The government of Tanzania agreed to pay US$27 million, which is roughly 39% of Montero’s initial demand. Payments were structured in three installments, with Montero receiving US$12 million by November 2024 and the remaining US$15 million paid by January and February 2025.

This resolution not only concludes the ongoing legal dispute but also avoids a tedious court process and the risks associated with an unfavorable ruling. Montero has invested around 15.5 million Canadian dollars into the project since its start in 2008, and despite attempts for an amicable resolution, the company previously filed a claim with the International Centre for Settlement of Investment Disputes (ICSID), which will now be cancelled.

Dr. Tony Harwood, Montero’s President and CEO, expressed satisfaction with the completion of the settlement, stating, “I am pleased Montero has timely received the third and final payment of US$7 million from Tanzania.” He indicated that the company is well-positioned to address the financial components of the settlement, including incurred legal costs.

Montero also mentioned plans to consider distributing the settlement funds to shareholders, potentially via capital returns, after assessing associated legal, taxation, and administrative factors. A decision on the distribution will likely be announced in the second quarter of 2025, although Montero will retain some settlement funds for any continuing expenses related to the dispute.

In summary, the conclusion of the payment dispute between Montero Mining and the Tanzanian government signifies a significant resolution in the realm of mining investments. Montero will receive a total of US$27 million, marking a fraction of its initial claim. This agreement not only consolidates the company’s current financial position but also outlines potential benefits for shareholders in the future, post-evaluation of all financial implications.

Original Source: africanminingmarket.com