Alamos Gold seeks $1bn from Turkey over stalled gold project
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Alamos seeks $1bn from Turkey over stalled gold project

21 Apr 2021 (Last Updated April 21st, 2021 08:53)

Alamos Gold is seeking more than $1bn in claims from the Turkish Government for what it considers as 'inequitable treatment' of its Kirazli gold project.

Alamos seeks $1bn from Turkey over stalled gold project
Alamos and its units expect to incur about $215m in an after-tax impairment charge. Credit: PollyDot from Pixabay.

Alamos Gold is seeking more than $1bn in claims from the Turkish Government for what it considers as ‘inequitable treatment’ of its Kirazli gold project.

The Canadian firm and its two Netherlands-based subsidiaries intend to file the claim under a Netherlands-Turkey bilateral investment treaty against Turkey for ‘expropriation and unfair and inequitable treatment’ concerning the stalled gold mine.

Alamos Gold said in a statement: “Alamos and the subsidiaries have invested over $250m in Turkey, unlocked over a billion dollars worth of project value, and contributed over $20m in royalties, taxes and forestry fees to the Turkish Government.”

The claim amount represents the sum value of all its assets in Turkish, the firm noted.

Alamos Gold said despite the firm meeting all legal and regulatory requirements for the renewal, the Turkish Government failed to grant a routine renewal of the project’s mining licences in October 2019.

All operations at the Kirazli mine in the Çanakkale Province were suspended by the firm in 2019 following protests by local citizens and environmentalists.

In October 2020, the forestry permit renewal for the gold mine was also cancelled by the government.

Alamos Gold added: “The failure to renew the company’s mining licences will result in the loss of over half a billion dollars in future economic benefits to the Republic of Turkey, including tax and other revenues, and thousands of jobs within Turkey.”

Alamos and its units expect to incur $215m in an after-tax impairment charge in its second quarter.

Alamos Gold CEO and president John A McCluskey said: “The Turkish Government has given us no indication that relief is in sight, nor will they engage with us in an effort to renew the outstanding licences.”