The Canadian mining company Montauk Metals (formerly Galway Gold) would have lost the investment arbitration opened against Colombia, before the International Center for Settlement of Investment Disputes (ICSID), due to prohibition of mining activities in paramo ecosystems. This has been confirmed, through a press release, by the Government of Colombia.
In the arbitration, filed in March 2018, the mining company claimed its interests in the operation of a mining project in a high-altitude ecosystem (paramo), an activity declared illegal by the Colombian Government in 2016. Montauk Metals claimed Colombia’s non-compliance to compensate it for losses suffered as a result of the ban.
The company’s claims amounted to USD 16 million in sunk costs and a total loss of value of up to USD 180 million on the Reina de ORO operation.
According to the Colombian Government document, the court: “recognized that Colombia’s measures were neither arbitrary nor unfair, thus consolidating a precedent regarding the sovereign management of natural resources and environmental protection.”
The court would have recognized that Colombia acted “in good faith” and dismissed the claims of expropriation and violation of the Fair and Equitable Treatment standard claimed by Montauk.
A fund financed the last phase of this procedure
In November 2023 we learned how the Omni Bridgeway fund was going to finance Montauk with US$200,000 to pay ICSID for the Court to rule on jurisdiction and liability.
The conflict
On April 18, 2018, the Canadian mining company Galway Gold filed an arbitration claim against Colombia invoking the Canada-Colombia Free Trade Agreement in relation to the Reina de Oro mining project.
In 2016, Colombia’s Constitutional Court ruled that all mining and oil operations in the paramos of high-altitude ecosystems, such as the Reina de Oro project, were illegal and that property permits were invalid.
The Reina de Oro gold concession is located in the Vetas Mining District, Colombia. The Galway Gold company was established in 2012 and has a 100% participation option in the exploitation of the Vetas project.
The Vetas gold-silver project has been in operation for more than 400 years and is the largest mine in the Vetas-California-Surata gold region in Colombia.
