Entrée Resources Wins Arbitration Decision
Entrée Resources Wins Arbitration Decision in Dispute with Joint Venture Partner
Vancouver, British Columbia - Entrée Resources Ltd., a Canadian mining company, has announced that it has won an arbitration decision against its joint venture partner Oyu Tolgoi LLC and Turquoise Hill Resources Ltd. The decision, which was made by a three-member international arbitration tribunal, rules in favor of Entrée on all issues and dismisses the respondents’ counterclaims.
The dispute between Entrée and its joint venture partner arose from disagreements over the interpretation and implementation of certain provisions of the amended 2004 Equity Participation and Earn-in Agreement and Joint Venture Agreement. Entrée commenced arbitration proceedings on May 26, 2022, seeking declarations and orders for specific performance relating to these provisions.
The tribunal’s award, which is final and binding, declares that OTLLC is obligated to provide Entrée with an executed copy of the JVA in the form appended to the Earn-in Agreement, subject only to any amendments to its terms that Entrée and OTLLC mutually agree. Additionally, OTLLC is obligated to facilitate and accept the transfer of the Shivee Tolgoi and Javhlant mining licenses for the Entrée/Oyu Tolgoi joint venture as required by the JVA.
The tribunal also reserved Entrée’s claims for specific performance, and in the alternative equitable damages, and the issue of costs, to a subsequent award. The company is currently considering potential next steps and will update the market in due course.
Entrée Resources Ltd. is a well-funded Canadian mining company with a unique carried joint venture interest on a significant portion of one of the world’s largest copper-gold projects - the Oyu Tolgoi project in Mongolia. The company has a 20% or 30% carried participating interest in the Entrée/Oyu Tolgoi joint venture, depending on the depth of mineralization.
The company’s President & CEO, Stephen Scott, commented on the arbitration decision, saying, “This Award represents a tremendous outcome for the Company and provides much needed certainty for all Oyu Tolgoi project stakeholders as we endeavor to keep Lift 1 Panel 1 development work on schedule.”
The arbitration decision is a significant milestone in the company’s efforts to resolve disputes with its joint venture partner and move forward with the development of the Oyu Tolgoi project. The company remains committed to working with its partners to reach a commercial resolution of matters related to the JVA and to transfer the Shivee Tolgoi and Javhlant mining licenses to OTLLC.
The Oyu Tolgoi project, which is located in Mongolia, is one of the world’s largest copper-gold projects, with a significant portion of the project’s mineralization lying beneath the Entrée/Oyu Tolgoi joint venture area. The project has the potential to produce a significant amount of copper and gold, making it an important asset for Entrée Resources Ltd.
In conclusion, Entrée Resources Ltd.’s arbitration victory against its joint venture partner is a positive development for the company and its shareholders. The decision provides much-needed certainty for the company’s efforts to move forward with the development of the Oyu Tolgoi project and could potentially lead to a commercial resolution of matters related to the JVA.
