UK-based gold exploration company Panthera Resources, through its Australian subsidiary Indo Gold (IGPL), has filed a claim for damages totalling $1.58bn against the Republic of India, alleging breaches of a bilateral investment treaty.
This claim arises from the alleged breach of the 1999 Agreement between the governments of Australia and India on the Promotion and Protection of Investments (the “Treaty”).
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The dispute centres on the Bhukia project in Rajasthan, India, where IGPL’s rights to a prospecting licence, held through a wholly owned subsidiary, Metal Mining (MMI), were denied.
MMI commenced its initial investment in the Bhukia project around 2004. IGPL supplied significant funding and oversaw the joint venture’s (JV) exploration programmes in collaboration with MMI.
IGPL claims that its entitlement to receive a prospecting licence for the Bhukia project, through its JV stake, was obstructed and hindered by the Government of Rajasthan over an extended period.
The company contends that the Government of Rajasthan’s actions and the enactment of the MMDR2021, an amendment to the Mines and Minerals (Development and Regulation) Act of 2015, which led to the revoking of preferential rights to mining licences, constitute a breach of the Treaty.
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By GlobalDataFurther complicating the matter, India auctioned part of the Bhukia project area to a third party, Saiyyed Owais Ali, with terms including $60m (Rs5.14bn) in upfront payments, $60m in performance guarantees and a 65.3% mineral share for India.
This auction occurred despite IGPL’s ongoing dispute over the project’s licensing rights.
The Treaty claims include allegations of expropriation and failure to protect investments under Articles 3 and 7 of the Treaty. However, the outcome of IGPL’s Treaty claims remains uncertain.
The Bhukia project’s potential was highlighted early on, with a JORC-compliant mineral resource estimate reported in 2006 and updated in 2017.
The JORC-compliant mineral resource estimate of the project is 38.5 million tonnes (mt) at 1.4 grams per tonne (g/t) gold for 1.74 million ounces (moz) of gold using a cut-off of 0.5g/t gold in the area.
Recently, a gazette notification from the Government of Rajasthan included an updated resource estimate of 113.52mt at 1.96g/t and 0.14% copper. This equates to 7.2moz of gold, along with copper credits, as well as additional nickel and cobalt.
To support the legal efforts, IGPL has secured up to $13.6m in non‐recourse litigation financing from LCM Funding, a subsidiary of Litigation Capital Management, which specialises in international arbitration and cross-border disputes.
This financing arrangement ensures that IGPL can pursue its Treaty claims without financial risk if no award or recovery is achieved.
In May 2024, Panthera entered into definitive agreements with DFR Gold and Maniger to restructure the ownership interests in the Kalaka gold project in Mali and the Paimasa, Dagma and Dext gold projects in Nigeria.
