Kenmare Resources has to pay $5m to Aveng after Moma arbitration ruling
London-listed Kenmare Resources would have to pay $5m to South African engineering and construction group Aveng after an arbitration ruling on a dispute over work on Kenmare’s Moma titanium minerals mine in Mozambique, Kenmare said in a regulatory filing on December 23.
Aveng held the engineering, procurement and construction management contract for the 50% expansion of the Moma facilities in 2010.
Aveng claimed R206m plus interest for work done, but Kenmare counterclaimed for considerably more for losses arising from contractual breaches.
The arbitrators found Aveng was entitled to the amounts it claimed, but that it had caused Kenmare substantial losses as well. However, Aveng’s liability was capped at R150m under the contract. The net effect was that Kenmare had to pay Aveng R56m plus interest.
Kenmare said it could pay this sum from its existing cash resources, and it was less than the $19.4m it had provided on its balance sheet. The costs of the arbitration would be decided separately.
Aveng’s shares added 4.46% to 796c on the JSE on Wednesday morning.