(Bloomberg) -- Burkina Faso said Timis Mining Corp. shouldn't go to court until it has exhausted local mediation over a dispute about one of the world's largest manganese deposits that the company says stems from the government's deliberate blocking of the project.
“The problem can't go to the courts before we've completed mediation,” Mines Minister Alfa Omar Dissa said by phone from Paris, where he's attending a conference to raise funds for the West African nation. “We're still in mediation at the request of Timis group, in line with the framework agreement in the contract. We will have to see how to resolve this.”
Companies owned by mining tycoon Frank Timis sent an arbitration request to the International Court of Arbitration in Paris seeking $385 million in damages because Burkina Faso has blocked the Tambao project and is seeking to deprive the companies of their investment, Reuters reported late Monday, citing the court filing. The court is part of the International Chamber of Commerce.
The matter is currently handled by the Center of Arbitration, Mediation and Conciliation in the capital, Ouagadougou, Prime Minister Paul Kaba Thieba said in an interview with Jeune Afrique on Dec. 2. A spokesman for Timis Group in Burkina Faso, Souleymane Mihin, said by phone he couldn't immediately comment.
Judicial Audit
The Tambao deposit is estimated to be worth $1 billion and contain about 100 million metric tons of manganese.
The unit of Timis that's developing the mine, Pan African Minerals, was told in March last year to suspend operations at the Tambao deposit as the interim government reviewed mining contracts awarded under former president, Blaise Compaore. Pan African Minerals obtained the rights to the project in 2012, two years before Compaore fled the country amid mass protests against his 27-year rule.
In October, a parliamentary committee of inquiry recommended that the government withdraw Pan African Minerals' permit altogether after a judicial audit showed that the company allegedly failed to fulfill certain obligations in its contract. The head of the committee, Ousseni Tamboura, said the permit should be given to a different company.
Tambao was the focus of an earlier rights dispute between Burkina Faso and Dubai-based Wadi al Rawda Investments LLC, which signed an exploitation agreement in 2007. After completing a feasibility study, the company accused the government of refusing to recognize its rights to the project and in 2011 took the matter to the arbitration court of the International Chamber of Commerce. The dispute was settled in 2013.
--With assistance from Baudelaire Mieu To contact the reporters on this story: Simon Gongo in Ouagadougou at sgongo@bloomberg.net, Pauline Bax in Johannesburg at pbax@bloomberg.net. To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net, Pauline Bax, Michael Gunn
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