IGO to record impairment against nickel assets in strategy shift
IGO has been undertaking a strategic review in an attempt to revaluate its resources.
Anglo American (LON:AAL) has become the latest corporation to sue Venezuela over the way it has treated foreign companies, by requesting a review of a 2012 cancellation of mining concessions by defunct president Hugo Chavez’s government.
The World Bank’s International Center for the Settlement of Investment Disputes (ICSID) accepted last week the appeal to Venezuela’s actions regarding the Loma de Niquel mining concession, which according to Anglo, breached the UK-Venezuela Bilateral Investment Treaty.
Loma de Niquel project.
The miner said it had a 91.4% in the Loma de Niquel project until the government cancelled 13 concessions and refused to renew three others.
“Anglo American considers that certain measures taken by the Government of Venezuela in relation to the Company’s investment in Loma, including the expropriation of Loma’s assets without prompt, adequate and effective compensation, constitute breaches by Venezuela of its obligations under the Treaty,” the company said in a statement quoted by America Economía (in Spanish), confirming the lawsuit.
As of December 2007, the month before Chavez government began unilaterally cancelling 13 of Anglo’s 16 concessions, the company had spent $616 million and almost 11 years on exploration, development and construction of Venezuela’s only nickel producer.
The country has now has 28 cases pending against it at the arbitration court, more than any other nation in the world. Venezuela officially requested to leave the ICSID in January 2012, after being a member since 1993, and companies face a July 25 deadline to file new suits.
