Kingsgate starts arbitration against Thailand
PERTH (miningweekly.com) – ASX-listed Kingsgate Consolidated has launched arbitration proceedings against the Kingdom of Thailand under the Australia-Thailand Free Trade Agreement (Tafta), after failing to reach a settlement for the unlawful expropriation of the Chatree gold mine.
The gold junior has held a number of meetings with the Thailand government, since notifying the government in April that it would be seeking a range of remedies, including compensation for the measures taken against the Chatree mine in violation of the Tafta.
As these meetings proved fruitless, the company on Thursday said that it would start arbitration proceedings in order to recover the substantial losses that it had suffered, and continued to suffer.
“Such proceedings could take an undetermined time to resolve, and could involve significant expenditure by Kingsgate,” the company warned shareholders, noting that the outcome of the proceedings could also not be guaranteed.
However, Kingsgate added that the start of arbitration proceedings still allowed both parties to engage in dialogue to settle the matter on mutually agreeable terms, at any point during the proceedings.
The Thailand government ordered the closure of the Chatree mine in 2016, resulting in production at the mine ceasing in December. No reason was given for the closure. However, in August the government lifted the temporary suspension, allowing for the application for a renewal of the mine’s metallurgical processing licence to proceed.
However, the Thailand government made no offer of monetary compensation for the losses that the company suffered as a result of the closure, or for the expense that would be incurred in restarting operations.
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