PERTH (miningweekly.com) – ASX-listed Greenland Minerals (GGG) has secured litigation funding from Woolridge Investments, a wholly-owned subsidiary of Burford Capital, to fully fund the arbitration costs in the dispute with the government of Greenland and the government of the Kingdom of Denmark.
GGG earlier this year launched arbitration proceedings in its dispute over the future of its Kvanefjeld rare earths project after the Greenland government in November banned uranium mining, impacting the development of the Kvanefjeld project.
GGG had previously noted that while the uranium was not of great economic significance to the Kvanefjeld project, the revenues generated by the uranium and other by-products would serve to reduce the rare earth production costs.
GGG said on Tuesday that the funding agreement will underwrite the entire budgeted legal and associated costs of the arbitration case. The agreement is entered into on a non-recourse basis and other commercial terms standard for funding agreements of this nature.
Entering a litigation funding agreement, which includes backfilling of costs already incurred, enables the company to preserve its cash reserves as it seeks other investments in the technology metals sector, GGG said.
"We are pleased to have signed this agreement. The funding facility, which is essentially a parallel line of financing, will provide more certainty on our costs and will maintain our liquidity while the arbitration is ongoing,” GGG MD Daniel Mamadou said.
“The company's primary objective remains the development of the Kvanefjeld rare earths project and, through the arbitration process that the funder will now be supporting, the company is seeking clarity on the application of Act No. 20 to the Kvanefjeld project, so that a path forward for the development of this important asset can be worked out by all parties.”