Trade Resources Economy Anglo American Is Unlikely to Seek Compensation for Its Loma De NíQuel Nickel Operation

Anglo American Is Unlikely to Seek Compensation for Its Loma De NíQuel Nickel Operation

Maplecroft principal Latin America analyst James Lockhart-Smith told BNamericas that Anglo American is unlikely to seek compensation from the Venezuelan government following the expiration of the concessions and permits for its Loma de Níquel nickel operation there.

Mr Lockhart-Smith said that "I would see it as quite unlikely at this stage given their cooperative approach so far. From the point of view of negotiation, it would have made more sense to raise the issue of compensation at an earlier stage."

The concessions expired on November 10 after the government had refused the company's requests for renewal. In an official statement at the time, Anglo said that it would "seek to wind up its operations in an orderly fashion."

According to Lockhart-Smith, in the cases of Vancouver based Rusoro Mining and Toronto's Crystallex International both of which are involved in arbitration at the World Bank's International Centre for Settlement of Investment Disputes over the expropriation of their assets in Venezuela, partial compensation is a likely outcome, though it may be a long road ahead.

He said that"This is going to be a very long, protracted process. We have seen in recent cases that some companies have been able to get semi-reasonable compensation from the Venezuelan government and they have had the hearings. But of course, one thing is being asked to pay X amount and the other is actually getting that, so you are likely to see partial compensation in these cases."

In fact, he added that "Earlier on in the year, one definitely had the feeling that the Venezuelan government was actually looking to process and respond to some of these issues fairly expeditiously in order to get the cases simply off its books essentially. So, I wouldn't dismiss the possibility of partial compensation in these cases."

Source: http://www.steelguru.com/stainless_steel_news/Anglo_American_unlikely_to_seek_compensation_for_Venezuelan_nickel_operation_Analyst/295968.html
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Anglo American Unlikely to Seek Compensation for Venezuelan Nickel Operation - Analyst