GERALD Group, a US commodity trading firm, has resolved a two-year dispute with the Sierra Leone government after agreeing to pay the state $20m and cede a 10% stake in the Marampa iron ore mine, said Reuters.
The dispute revolved around a government royalty claim that Gerald Group took to international arbitration. The settlement, signed on May 7, allows the US firm to immediately ship some 707,000 tons of iron ore at a time when the mineral is smashing new price records.
“I am delighted that we have been able to resolve our differences and have a fresh start and new beginning with the government of Sierra Leone,” Gerald’s chairman and CEO Craig Dean was quoted by Reuters to have said.
Sierra Leone’s Mines Minister Timothy Kabba told a news conference on Tuesday that the agreement was a milestone for the country. “Whatever the pain we may have borne or dreaded throughout these two years … this outcome justifies our action,” he said.
Both sides will withdraw their legal claims before the International Chamber of Commerce (ICC) and International Centre for Settlement of Investment Disputes (ICSID), said Reuters, citing a statement by Gerald Group.
Sierra Leone’s government had cancelled the Marampa operation’s mining licence in response to the mine’s closure by Gerald Group.
Gerald estimates that Marampa holds about 1 billion tons of iron ore with a potential lifespan of 30 years.