Undersea Miner Nautilus Jumps on Arbitration WinGerrit De Vynck
Nautilus Minerals Inc. jumped the most in seven years after winning an arbitration case against Papua New Guinea in a dispute over the company’s Solwara 1 undersea copper- and gold-mining project.
Nautilus rose 51 percent to 55 Canadian cents (53 U.S. cents) in Toronto, the biggest gain since May 2006.
The arbitrator, former Australian High Court judge Murray Gleeson, declared that Papua New Guinea breached an agreement signed with the Toronto-based company by failing to complete the acquisition of a 30 percent stake in Solwara 1 by Nov. 7, 2011, Nautilus said today in a statement.
As part of the decision, which is final and binding, Gleeson ordered Papua New Guinea to complete the purchase and pay 30 percent of project expenditures incurred to date, Nautilus said. The company issued the government with a notice requiring the completion of the deal by Oct. 23. It said the total sum due to the company is about $118 million.
Calls to Papua New Guinea’s consulate in Toronto seeking comment on the decision weren’t answered.
Papua New Guinea granted Nautilus the world’s first deep-sea mining lease in January 2011. Solwara 1 is located in the Bismark Sea, near the island of New Ireland.
The company plans to cut ore from the seabed 1 mile (1.6 kilometers) below the surface using two tracked robots. A third machine will suck up the rock-and-water slurry, which will be pumped to the surface, processed and transferred to a transport ship. Nautilus has an agreement to supply ore to Tongling Nonferrous Metals Group Co. Ltd., a Chinese copper refiner.
“We can’t provide a timeline for when we expect to be producing at this time,” John Elias, a Nautilus spokesman, said today in an e-mail.