Emmerson PLC / Ticker: EML /
Index: AIM / Sector: Mining
1 November 2024
Emmerson
PLC
("Emmerson" or the
"Company")
STATEMENT REGARDING NOTICE OF
DISPUTE WITH MOROCCAN GOVERNMENT
Emmerson, the Moroccan focused
potash development company, provides an update on its position with
respect to its assets and investments in Morocco.
Emmerson has formally notified the Government of the Kingdom
of Morocco ("Morocco" or "the Government") that there is an
investment dispute between Emmerson and the Government. The Company
has engaged Boies Schiller Flexner LLP as its litigation counsel
and is examining various funding avenues for an investment
dispute.
The dispute arises out of various
breaches, by the Government and its Agents, of the Agreement
between the Government of the United Kingdom of Great Britain and
Northern Ireland and the Government of the Kingdom of Morocco for
the Promotion and Protection of Investments, which was signed on 30
October 1990 and entered into force on 14 February 2002 (the
"BIT").
The BIT provides that Emmerson may
submit its dispute for settlement by arbitration to the
International Centre for the Settlement of Investment Disputes
("ICSID").
There is no requirement under the
BIT to notify Morocco of Emmerson's intention to submit a claim to
arbitration and therefore, the Company has no obligation to wait
for any specific period of time before commencing
arbitration.
Nevertheless, before proceeding to
arbitration, Emmerson has, in good faith and in the spirit of
cooperation, invited Morocco to engage in discussions regarding
cash compensation for the damages incurred because of Morocco's
breaches of the BIT, with a view to achieving an amicable
resolution of the dispute.
If such discussions with Morocco are
unsuccessful, Emmerson intends to submit a claim for arbitration
under the BIT, seeking damages for the harm described above, plus
interest, costs, and any such further relief as the Tribunal may
deem appropriate in the circumstances.
The Company remains hopeful that its
dispute with the Government can be resolved amicably. The Company
will consider any and all other actions necessary to ensure its
rights are preserved.
Emmerson has always conducted its business in Morocco to the
highest environmental and ethical standards, often well in excess
of the local regulatory requirements, adhering strictly to local
laws. The Khemisset Potash Project is one of the most strategically
valuable fertiliser assets on the African Continent, especially for
Morocco, which currently imports significant quantities of potash
to its global fertiliser company, OCP.
With the implementation of its proprietary (and patent
pending) KMP design, the Company was targeting the production of
potash alongside several complementary fertiliser products that
would have employed the lowest water usage of any potash mine
globally, with the elimination of waste brines entirely, in order
to create the world's most environmentally sustainable potash
mine.
Market Abuse Regulation (MAR) Disclosure
This announcement contains inside
information for the purposes of the UK Market Abuse
Regulation and the Directors of the Company are responsible for the
release of this announcement.
About Boies Schiller Flexner LLP
Boies Schiller Flexner is a firm of
internationally recognized trial lawyers, crisis managers, and
strategic advisers known for its creative and efficient pursuit of
successful outcomes for its clients. Boies Schiller Flexner has
served as lead counsel in multiple arbitrations in the mining
industry including the recent favourable awards for GreenX Metals
in its arbitration with Poland and subsidiaries of Indiana
Resources in its dispute with Tanzania.
**ENDS**
For further information, please
visit www.emmersonplc.com ,
follow us on Twitter (@emmerson_plc), or contact:
|
Emmerson PLC
Graham Clarke / Hayden
Locke
|
+44 (0)
207 138 3204
|
|
Panmure Liberum Limited (Nominated Advisor and Joint
Broker)
Scott Mathieson / Matthew
Hogg
|
+44 (0)20
3100 2000
|
Notes to Editors
Emmerson is focused on advancing the
Khemisset project ("Khemisset" or the "Project") in Morocco into a
low cost, high margin supplier of potash, and the first primary
producer on the African continent. With an initial 19-year life of
mine, the development of Khemisset is expected to deliver long-term
investment and financial contributions to Morocco including the
creation of permanent employment, taxation, and a plethora of
ancillary benefits. As a UK-Moroccan partnership, the Company is
committed to bringing in significant international investment over
the life of the mine.
Morocco is widely recognised as one
of the leading phosphate producers globally, ranking third in the
world in terms of tonnes produced annually, and the development of
this mine is set to consolidate its position as the most important
fertiliser producer in Africa. The Project has a large JORC
Resource Estimate (2012) of 537Mt @ 9.24% K2O, with significant
exploration potential, and is perfectly located to support the
expected growth of African fertiliser consumption whilst also being
located on the doorstep of European markets. The need to feed the
world's rapidly increasing population is driving demand for potash
and Khemisset is well placed to benefit from the opportunities this
presents. The Feasibility Study released in June 2020 indicated the
Project has the potential to be among the lowest capital cost
development stage potash projects in the world and also, as a
result of its location, one of the highest margin projects. Updated
financial estimates published in February 2024 indicated a net
present value of US$2.2 billion, with an internal rate of return of
approximately 40%.