TriMetals up 67% on Bolivia settlement news
TriMetals Mining Inc. [TMI-TSXV; TMIBF-OTCQX] shares rallied sharply Thursday August 29 after the company said it expects to receive US$25.8 million after reaching a settlement deal with the Bolivian government that followed the expropriation of the Malku Khota Project in 2012.
The Malku Khota Project is one of the world’s largest silver, indium and gallium resources, with a NI 43-101-compliant indicated resource of 255 million tonnes of mineralized material, containing 230.3 million ounces of silver, 1,481 tonnes of indium and 1,082 tonnes of gallium.
On top of that is an inferred resource of 230 million tonnes, containing 140 million ounces of silver, 935 tonnes of indium and 1,001 tonnes of gallium.
The announcement comes nearly nine months after an arbitral tribunal ordered Bolivia to provide TriMetal’s wholly-owned subsidiary South American Silver Ltd. (SASL) with US$18.7 million in compensation and pay interest running from August 2012.
TriMetals is focused on exploration and resource expansion at its flagship Gold Springs gold-silver project in Nevada and Utah.
TriMetals advanced on the news, rising 67% or $0.03 to $0.075 on active volume of 1.84 million. The shares were previously trading in a 52-week range of $0.03 and $0.095.
To avoid the time and expense of pursuing enforcement proceedings to collect the award, which the company and the third party funder of the arbitration agreed could take years with no guarantee of outcome, the company and the fund decided to initiate discussions with Bolivia with a view to obtaining a prompt settlement.
“From the first meeting with Bolivia, and during the meetings that ensued, it became known to the company that prompt settlement would not be possible if the company did not agree to transfer the [exploration] data to Bolivia as, for Bolivia, the data were crucial to facilitate the further development of the project,” TriMetals said in a press release.
“The company determined it was in its best interest to reach a prompt settlement with Bolivia by transferring the data and by accepting a discount to the amount payable to claim pursuant to the award,” the company said.
Pursuant to the settlement agreement, Bolivia has agreed to pay US$25.8 million to the company as a final settlement amount on or before September 5, 2019, and the company agreed to transfer the data to Bolivia.
Bolivia will deduct $209,475 from the amount payable in satisfaction of the cost order included in the award. The company expects to recover the US$209,475 from the fund, as it related to costs and expenses of the arbitration payable by the fund.
Once paid, the company will cease all legal activities related to the collection of the award.
“Reaching a settlement with Bolivia and concluding the arbitration dispute is an important milestone for the company and our shareholders,” said TriMetals President and CEO Matias Herrero.
“All efforts and attention can now be focused on growing and creating value for the company, by exploring and further developing the mineral resources at the historic Gold Springs Project in southern Utah and Nevada, both top 10 mining jurisdictions in the world,” Herrero said.
The company now said it has 60 days from the date of payment by Bolivia to redeem all 116.4 million Class B shares outstanding. In the coming weeks, the company will notify its Class B shareholders, along with their agents and/or brokers, about the procedure to redeem the Class B shares