The arbitral tribunal by the International Centre for Settlement of Investment Disputes (ICSID) will hold its first session on April 22 to hear the $95 million international compensation claim filed against Tanzania’s government by Indiana Resources Ltd of Australia last April.
In a notice to shareholders, Indiana said, “Cavinder Bull of Singapore has been appointed president of the arbitration tribunal with Justice Sanji Monageng of Botswana and Doak Bishop of the US confirmed as arbitration panel members.”
Tanzania will be represented by Attorney General Prof Adelardus Kilangi and Solicitor General Gabriel Malata in the hearing to be held at the Washington DC-based ICSID, which is an arm of the World Bank.
Indiana argues that expropriation of its nickel project breached agreements signed by Tanzanian, British and the Northern Ireland governments for promotion and protection of investments under bilateral investment treaties.
Indiana Resources is the majority shareholder of Ntaka Nickel Holdings Ltd and Nachingwea UK Ltd, both incorporated in Britain, in a nickel joint venture in southeastern Tanzania.
Costs of arbitration
“With a non-recourse litigation funding facility in place that provides for $4.65 million to cover all legal costs associated with arbitration we are confident costs in relation to arbitration will not be borne by shareholders,” Indiana’s executive chair Bronwyn Barnes said.
Indiana secured the litigation funding agreement (LFA) for $4.6 million with Litigation Capital Management Ltd that is listed on the alternative investment market of the London Stock Exchange.
The LFA will cover legal costs in bringing the claim to arbitration against the Government of Tanzania on a non-recourse basis ensuring that costs relating to the arbitration will not be borne by Indiana’s shareholders.
At the same time, Montero Mining and Exploration Ltd has secured $2.32 million funding for legal proceedings against Tanzania while Winshear Gold Corporation has also secured an undisclosed amount for a similar arbitration against Tanzania.
The two are seeking compensation for the inappropriate seizure of SMP Gold Project in southwestern Tanzania and Wigu Hill rare earths mineral project, 170km from Dar es Salaam, respectively.