OREA Terminate Nordgold Acquisition VANCOUVER, BC, June 13, 2023 /CNW/ - Orea Mining Corp. ("Orea") (TSX: OREA) (OTCQB: OREAF) (FSE: 3CG) reports that the recent denial by the Canadian government of the proposed acquisition by Orea of Nord Gold plc's ("Nordgold") 55.01% interest in the Montagne d'Or gold project (the "Acquisition"), has led to Orea providing Nordgold with a formal notice of termination of the Acquisition. The Acquisition, if consummated, would have removed sanctioned persons from controlling a major gold deposit with an after-tax net present value of US$370 million based on a lower gold price for reserves of US$1,200 per ounce; gold prices are currently more than 60% higher over ~US$1,900 per ounce.*
It is the understanding of Orea and its legal advisors that there are no conditions under which Canada will approve the Acquisition, even though other countries that are close allies of Canada have approved or not objected. Orea remains the owner of a 44.99% interest in the Montagne d'Or gold project and is currently assessing its options going forward.
Well, it seem that while the EU, US and UK did not, CAD has done France/Macron the big favor and destroyed OREA's Montagne d'Or moves with NG. Therefore, now looks like the time for the final shot. Misled upto 2019 by Macron's 180 support switch for the mine, both the company and shareholders have been seriously financially damaged. Sunken costs for OREA around US$20 mill' as well as mills in sp loss.
The case will likely be given over to international arbitration legal firm(s) meaning substantial legal costs and commission (25 - 33%) will be incurred, but paid for out of any award.
The French SC decison re., exploration license renewal seems irrelevant now as any mine permits are already sunk here in the morass of Russian sanctions along with OREA's inability to meet international deadlines. As to penalties against France for not carrying out previous court orders, I would love to see them, however, I just don't see a judgement here (French SC may even use the new climate considerations recently issued in this judgement even though it is supposedly 'process' only that was to be the focus of any decsion). In fact the FSC may just sit on this case for...?
If NG provided it then OREA has the new mine evaluation to use at around 8 bill or the old BFS at around half. However, regardless this is an OREA only (45%) legal redress, NG would not be included. The CofA is loathe to go much above sunken costs in its awards if one is made. Asking for the same amount as NG apparent did in their 2020 legal action of around 500 mills in compensation is, IMHO, a waste of time (NG was going via the French Russian Investment Treaty route, not the more 'politically' environmentallyimpacted CofA). Sunken coasts plus an analysis of the drop in company value from e.g., just pre BFS at around 80 cents to today at 0.02 would be an estimate of data based destroyed value causing actual verfiably fianiclal harm to OERA and shareholders (not a theoretical not one spade in ground mine).
After all legal costs and comission are deducted anything left from an award should be shared out amongst shareholders and the company folded. OREA has no assets outside of any AUAU shares left. It is a pure arbitration play with no real value beyond a judgement, which, without an out of court settlement could take 2 - 5 years.
GLTA - https://twitter.com/EarthsRare