Montero Mining and Exploration (TSX-V: MON) has successfully negotiated a US$ 27 million settlement with Tanzania following a prolonged dispute over the expropriation of its Wigu Hill rare earth element project.
This announcement was made on 20th November 2024 by Montero through a press release.
The agreed settlement will be paid in three installments, with the first payment of US$ 12 million already received by Montero on 20th November 2024.
The remaining amounts, US$ 8 million and US$ 7 million, are due on or before 31st January 2025, and 28th February 2025, respectively.
The settlement averts the need for further arbitration proceedings and the risk of a potentially unfavorable ruling, which could have delayed or complicated the enforcement process.
Furthermore, Montero and Tanzania have jointly requested a suspension of the ongoing ICSID arbitration, with plans to discontinue the proceedings entirely once the final payment is received.
Speaking on the matter, the President and CEO of Montero, Dr. Tony Harwood expressed his satisfaction with the resolution, highlighting: “I am pleased Montero was able to reach an amicable settlement with the government of Tanzania to bring a mutually beneficial end to this dispute. This resolution allows both parties to move forward, and we wish Tanzania every success in attracting new mining investment.”
Montero and Tanzania’s Wigu Hill Dispute
The dispute between Montero Mining and Exploration and the Tanzanian government over the Wigu Hill rare earth element project spans several years.
In 2008, Montero began exploration activities at Wigu Hill, investing approximately CAD$ 15.5 million in the project’s development.
Tensions arose in 2018 when the Tanzanian government canceled Montero’s retention licenses for Wigu Hill, which Montero interpreted as expropriation.
This action prompted Montero to argue that it had created significant value for Tanzania through its investments.
In January 2021, after unsuccessful attempts to resolve the issue amicably, Montero initiated international arbitration proceedings against Tanzania through the International Centre for Settlement of Investment Disputes (ICSID).
This was done under the bilateral investment treaty between Canada and Tanzania, which protects investment rights. The company claimed damages exceeding CAD$ 90 million, including interest.
