Botswana has finally paid Norilsk Nickel an undisclosed amount of money in an out of court settlement.
Norilsk Nickel, the world’s largest producer of palladium and high-grade nickel and a major producer of platinum and copper, announced last week the settlement of its dispute with the Government of Botswana and BCL Group arising from the transaction for the sale of Nornickel’s assets in Africa, including a 50% interest in JV Nkomati, to BCL Group.
As part of the settlement, the firm said, the parties have waived any and all claims against each other in connection with the transaction and Nornickel has received an agreed cash compensation, the company said without disclosing the amount that the duo had agreed upon.
“As a result, Nornickel has withdrawn its claim against BCL Group in the London Court of International Arbitration (LCIA) and is in the process of terminating its court proceedings in Botswana against the Government,” the Russian firm said.
In October 2014, Nornickel signed a sale agreement with BCL Group for the sale of its interests in the Nkomati and Tati mines. In September 2016, the agreement became unconditional, but BCL Group did not complete the transaction.
In October 2016, the Government of Botswana (the ultimate shareholder of BCL Group) successfully petitioned the High Court of Botswana to place BCL Group into provisional liquidation.
Nornickel subsequently filed a claim against BCL Group in the LCIA and a claim against the Government of Botswana in the High Court of Botswana, claiming that Government was liable for BCL’s debts to Nornickel.
In 2018, Nornickel terminated the sale agreement in light of BCL Group’s breach of contract, but continued its claims against the Government of Botswana and BCL Group.
The settlement brings this matter to a close as per the agreement of the relevant parties.
PJSC Norilsk Nickel Co.’s dispute with Botswanan state-run BCL Group over the botched sale of its African assets is to be brought before the London Court of International Arbitration, after the Botswana Court of Appeal overturned an earlier decision rejecting Norilsk’s request to take the case to London.
The Russian mining company, which is the world’s largest producer of palladium, terminated an agreement to sell its African assets, which include a 50% stake in the Nkomati nickel mine, to BCL in December 2018, and is seeking to recover US$271 million plus damages from the state-owned miner.
The Botswana Court of Appeal approved Norilsk’s request for the London Court of International Arbitration, LCIA, to arbitrate and ordered BCL Group to pay Norilsk’s legal costs in Botswana.
Botswana placed state-owned BCL Mine Ltd., its largest copper and nickel producer, under provisional liquidation due to unprofitability in 2016, following which Norilsk launched legal action with a request to the London Court of International Arbitration and a lawsuit in the court of Botswana.