Tanzanian Royalty Exploration Corp (NYSEMKT:TRX) cries out over mine invasion by fake artisans
Tanzanian Royalty Exploration Corp (NYSEMKT:TRX), which recently logged a loss of $3.6 million in its F2Q2016, is complaining over the invasion of its mines in Tanzania by well-equipped and funded miners posing as artisanal miners. With that, the company has evoked a Force Majeure clause in the agreement it signed with the Tanzanian government.
According to Tanzanian Royalty Exploration Corp (NYSEMKT:TRX), the Force Majeure was triggered by a sharp increase of illegal miners at the mining properties covered by its license. The company links the invasion of its mines by illegal miners to a statement made in a Tanzania village by a high-ranking government official, a deputy minister. According TRX, the deputy minister issued orders and accompanying repercussions for noncompliance that it feels are not covered by its agreement with government. One such order required the company to fix a road, but it says the road was damaged by rains but the deputy minister made it appear as if it was the company’s activity that damaged that road.
What next with the stalemate?
By evoking the Force Majeure clause, Tanzanian Royalty Exploration Corp (NYSEMKT:TRX) has suspended operations and has put forward three possible options to address the dispute. The company says that within a period of 30 days, it and the government can renegotiate in good faith to ensure that its rights are not violated.
The second option is that the company could refer the dispute to the international arbitration panel in London where it would seek compensation for damages and recovery of investment it has made in Tanzania. The third option is that the company could auction its Tanzania assets and potentially bail out of the country.
It is no clear which of the three options for settlement are favored by Tanzanian Royalty Exploration Corp (NYSEMKT:TRX).
Northern Dynasty Minerals Ltd (NYSEMKT:NAK) issues notice of AGM
Northern Dynasty Minerals Ltd (NYSEMKT:NAK) plans to hold its Annual General Meeting (AGM) of shareholders on June 16. The company will mail shareholders about the meeting because the location of the AGM has yet to be finalized.
Northern Dynasty Minerals Ltd(NYSEMKT:NAK) is planning shareholder AGM after a series of restructuring measures in the company, including shrinking of the board of directors. The recent adjustments by Northern also appear to be in response to the lower oil prices that has limited growth opportunity for energy industry participants.
In the same notice that communicated the coming AGM, Northern also talked about
Impact of oil price collapse
The falling price of crude oil prices is damaging value for energy industry as revenue shrinks, debts balloon and buying power gets eroded. But beyond adjusting to cope with the prevailing conditions in the energy industry, Northern is also planning for the long-term future.
Northern Dynasty Minerals Ltd (NYSEMKT:NAK) recently reduced the number of people who sit on its board to just seven. The lean board is expected to be more focused and promote crisp execution in the company going forward.