Canadian mining firm Cline Mining has signed a settlement agreement with the province of British Columbia to halt some of its coal licences and applications, after losing its right to develop coal deposits in the Flathead River, near Glacier-Waterton International Peace Park.
In 2012, Cline also reported that the rights under its coal licences and coal licence applications for its Lodgepole, Sage Creek and Cabin Creek coal properties in Flathead Valley were affected, following the passage of the Flathead Watershed Area Conservation Act (FWACA) by the government.
Following an out of court settlement, the British Columbia Government will pay a cash amount of $9.8m.
The government's decision came after it paid $30m to uranium miner NDP for halting a uranium mining proposal near Kelowna in 2008.
The government passed the FWACA stating that Flathead Valley is a biodiversity hotspot that provides habitat for 16 carnivorous mammals, six species of hoofed animals and grizzly bears.
The FWACA also created a mineral and coal land reserve on all lands within the Flathead River watershed area, claimed the company.
Cline had previously sought compensation of about $500m for the loss of value of the coal licences and applications.
Under the current agreement, the company is operating according to forbearance agreements with its senior lenders, which expire on 30 April, providing there is no other forbearance termination event before that time.
Cline may not use the proceeds from the settlement, as they are subject to the terms of the forbearance agreements and the underlying indentures.