Junior exploration company Montero Mining and Exploration has completed a litigation funding agreement with Omni Bridgeway Canada to draw down $2.32-million from a financing facility to meet fees and expenses relating to Montero's pursuit of legal claims against the government of Tanzania.

Montero alleges that the Tanzanian government illegally expropriated the Wigu Hill rare earth element project.

The company has retained Thierry Lauriol and his team at law firm Jeantet as legal counsel.

“Montero’s legal representatives, Jeantet, backed by the financial support of the litigation funder Omni Bridgeway, have been engaged to aggressively pursue compensation for the illegal activities of the government of Tanzania in expropriating the Wigu Hill project,” says Montero president Dr Tony Harwood.

BACKGROUND INFORMATION
Montero in January 2020 delivered a notice of intent to submit a claim to arbitration to the Attorney General of Tanzania in accordance with the 2013 Agreement for the Promotion and Reciprocal Protection of Investments in the Bilateral Investment Treaty (BIT) between Canada and Tanzania.

The company states that the dispute arises out of certain acts and omissions of the government in Tanzania in breach of the BIT and international law, relating to Montero’s investment in the Wigu Hill project.

Montero commenced exploration activities on the Wigu Hill project in March 2008 when it was held under prospecting licence. Montero subsequently, on advice from the Mining Commissioner, applied for a retention licence in 2014 and this was granted in 2015 and was valid for a period of five years.

According to Montero, the Tanzanian government In 2017 announced amendments to the Mining Act 2010, which, besides others, abolished the legislative basis for the retention licence classification with no replacement classification. On January 10, 2018, the government published the Mining (Mineral Rights) Regulations 2018 which, under Regulation 21, cancelled all retention licences issued prior to that date, which would cease to have any legal effect. The rights to all areas under retention licences were immediately transferred to the government of Tanzania.

In December 2019, the Mining Commission of Tanzania announced a public invitation to tender for the joint development of areas previously covered by retention licences, including the area of the Wigu Hill retention licence. The abolition of the Wigu Hill retention licence and the removal of the various rights to the minerals conferred by this licence has rendered the Wigu Hill project valueless to Montero.

"Therefore, as a direct consequence of the legislative, regulatory and other measures made by the Tanzanian government, Montero has lost completely its investment," the company states.

Montero has initiated international arbitration proceedings in accordance with the BIT between Canada and Tanzania. Compensation being sought for expropriation of the Wigu Hill project may include, but will not be limited to, the value of the historic investment made by Montero in Tanzania, the value of the project at the time that tenure was expropriated and damages the company has suffered.