Yamana Gold Clarifies Information Relating To Certain Interests In Catamarca Province In Argentina
Ricardo Auriemma ("Auriemma") and to recent developments in Andalgala, a municipality in the Catamarca province of
Since 2003, Yamana through its subsidiary 0805 has been in litigation with Auriemma relating to a purported lost opportunity of Auriemma under a contested agreement providing for a preemptive right to participate in the acquisition of
This is the second time that such an arbitrator has been appointed for this purpose. The first arbitrator provided a report in early 2015 to which 0805 objected. At that time, 0805 applied for an annulment of the award suggested in the report on the basis that the valuation was flawed. The annulment was granted and the matter was then sent for a second arbitration, which has now been completed. Information in the public markets indicates that an award has been given of a certain amount in relation to this litigation. Clarification and correction of this information follows.
The current report provides only a suggestion of value at
0805 has determined that there are several flaws in this latest report, as was the case in the first report, and that the instructions of the court pursuant to which the arbitration is being conducted were not followed. In addition, the latest report is advisory of the amount of the award and is not a determinative award. As such, an application has been made to annul the report on similar grounds to the application to annul the first report which succeeded. 0805 believes that pursuant to the instructions for conducting the valuation, any award should be at most de minimis or nominal.
In addition to the application for an annulment of the current arbitration, 0805 will continue to consider all its legal options to defend its interests.
(All amounts are expressed in
There is also information in public markets that relates to an action taken by a municipal committee of a town near the Agua Rica project that purports to ban open pit mining.
The Company is advised that the use of rivers, mining activities and environmental matters, as set out in the Constitution, are the purview of the Government of the Province of Catamarca and, as such, the municipal ordinance is not binding or legal and is mostly symbolic.
Yamana is committed to the future development of Agua Rica and has been working towards developing an improved project design that is expected to improve the economics of the project and decrease the environmental footprint. One development scenario contemplates the integration of Agua Rica into the infrastructure of the neighboring Alumbrera mine. Under this scenario, the Alumbrera mine infrastructure could continue to operate and provide significant benefits to the local communities for upwards of an additional 25 years. These project updates and this development scenario will be presented to the Government of Catamarca in the following weeks. Separately, effort will be made to ensure that the residents of the local community remain supportive.
To that end, the Company continues to work with stakeholders to ensure existing mining laws and frameworks for the development of mining projects are respected. While the project is at a stage of review and evaluation and any formal decision to proceed is pending discussions with the Province of Catamarca, it is important to note that already more than one hundred residents of Andalgala are directly and indirectly employed in the project and the Company enjoys community support for the project.
While no formal action has been taken in relation to vacating the municipal ordinance, discussions are continuing on the most effective manner for the development of the project respectful of local communities, the province and the country.
Yamana is a Canadian-based gold producer with significant gold production, gold development stage properties, exploration properties, and land positions throughout the
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