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Wednesday, 18 January 2023

Centamin to request gold mine lawsuit be rejected after Supreme Court ruling on state-investor contracts

LSE-listed gold miner Centamin will file to have a 2011 legal challenge against its Sukari mine thrown out following the Supreme Constitutional Court’s (SCC) decision last week to uphold a law that bars third-party lawsuits against state-investor contracts, the company said in a statement Monday.

ICYMI- The court last week upheld the constitutionality of the Appeals Against State Contracts Act, a 2014 bill that prevents third-parties from mounting legal challenges against contracts signed between the government and investors. The Administrative Court had asked the Supreme Constitutional Court to rule on the constitutionality of the act as part of a years-old case brought by employees of the Nubaria Seed Production Company (NUBASEED) against the government's decision to privatize the company. The court’s decision means the 2014 bill will now apply to all active and future cases.

An 11-year legal challenge: The Sukari mine concession — an agreement between the Egyptian government, Centamin's Egyptian subsidiary Pharaoh Gold Mines (PGM), and the Egyptian Mineral Resource Authority (EMRA) — was challenged in 2011 by a third-party individual. A year later, the Supreme Administrative Court held that even though the agreement itself was valid, EMRA and PGM hadn’t received the necessary approvals for the exploitation lease. PGS launched an appeal but the final decision has been pending the SCC’s ruling on the Appeals Against State Contracts Act.

What they said: “[Saturday’s] judgment on the constitutionality of Egyptian Law No. 32 is most

welcomed. We are delighted to now be in a position to apply to set aside the 2011 third-party challenge to the validity of the Exploitation Licence issued under the Sukari Concession Agreement,” said Centamin CEO Martin Horgan.

What’s next: Centamin will “imminently”' submit an application requesting the resumption of its appeal proceedings and for the original case to be rejected “in its entirety in accordance with the provisions of Law 32,” the statement reads.

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