03 Jun 2019

The matter between Russian’s Norilsk Nickel and BCL has been brought before the London Court of International Arbitration (LCIA) while it is still before the Gaborone High Court.  

A press release from the company states that this comes after Court of Appeal gave them leave to take their dispute against the government over the 2014 equity sale to LCIA.

The company notes that it was not yet clear when the case will be heard before the court adding the parties are currently dealing with the procedural issues and the hearing schedule would be known at a later stage.

“The LCIA will have to determine whether all conditions precedent to the Nkomati transaction had been fulfilled and to assess the damages to be paid by BCL to Norilsk,” reads the release.

Should the Nornickel be successful, the press release states that it will be the government’s responsibility to pay the costs as it fully owned the mothballed operation.

The matter between government and Norilsk comes from a purchase agreement in October 2015 which provided for the transfer to the BCL Group of Nornickel’s interests in the Nkomati mine in South Africa and Tati mines in Botswana.

When the agreements became unconditional in September 2016, the BCL Group failed to perform its obligations and the Selebi Phikwe copper-nickel mine was closed down in October 2016 before the sale was finalised and the parties have since locked horns in Johannesburg and Gaborone courts over payment for the deal.

The company said in the meantime it was still pursuing its right with regard to an appeal filed with the South African Minerals minister.  Last year, Nornickel terminated the agreement to sell its African assets to the BCL Group, including a 50 per cent stake in the Nkomati joint venture.

The company no longer requires BCL Group to purchase its interest in the Nkomati joint venture but seeks damages for the significant loss it has suffered as a result of the BCL Group’s failure to honour its obligations.

According to the press release, the Court of Appeal held that it was not precluded from granting permission to proceed with a claim that had already been initiated, and said that its decision would result in a costs saving for the parties.

The Court also agreed that it was for the LCIA to determine whether all the conditions precedent to the Transaction had been fulfilled and to assess the damages payable to Nornickel. ENDS