FRESNILLO, the world’s largest primary silver producer, said an arbitration panel had rejected the principal demands of MAG Silver, its joint venture partner at the Juanicipio project in Mexico.
The panel rejected MAG’s claims that the FTSE 100 miner was deficient in the execution pace or performance of drilling at the exploration project, Fresnillo said.
The panel denied the principal demands that Fresnillo be ordered to pay damages to MAG of up to $61m (£37.3m) relating to delays and that Fresnillo be ordered to dispose of its equity participation in the Juanicipio joint venture to MAG.
However, the panel upheld other claims, such as one related to Fresnillo’s announcement in 2008 that it intended to make an unsolicited bid for MAG.
It ordered Fresnillo to reimburse MAG for legal fees of $1.86m relating to that claim.
The Panel ruled that each party should pay 50 per cent of the $775,000 arbitration cost and bear their own legal costs.
Shares in Fresnillo closed 0.14 per cent higher yesterday, up 2p to £14.38.
City A.M. Reporter