Churchill Mining files international arbitration against Indonesia, Australia

Churchill Mining files international arbitration against Indonesia

24 May 2012

By Andre Lamberti

Churchill Mining (LON:CHL) said it has now filed for international arbitration in its dispute regarding the East Kutai coal project (EKCP) in Indonesia, 75 per cent owned by Churchill.

It has filed a claim yesterday, May 22, at the International Centre for Settlement of Investment Disputes (ICSID) in Washington, DC, against the Republic of Indonesia for breaches of its obligations under the Bilateral Investment Treaty (BIT) with the UK.

It had announced its plan to file the arbitration at the beginning of May.

Churchill told investors it is seeking full relief owed to it under the provisions of the UK-Indonesia BIT and under international law.

Churchill chairman, David Quinlivan commented: "The board of Churchill is concerned that it has had to resort to international arbitration with an emerging economy such as the Republic of Indonesia.

“At all levels there seems to be a lack of support from Indonesia with regard to our contentions on the EKCP. We look forward to now addressing and rectifying these issues on the balanced platform that international arbitration at ICSID provides foreign investors."

The company will inform the market when further information becomes available.

Churchill filing for international arbitration at ICSID follows Indonesia’s failure to rectify the issues described in two previous letters to the President of Indonesia, the group said.

Both letters emphasized that following a significant investment in the EKCP Churchill identified a world class thermal coal deposit in East Kalimantan.

Shortly thereafter, Churchill became the subject of a sustained campaign designed to divest Churchill’s legitimate rights to develop this deposit and the EKCP.

The international arbitration will run in parallel with the current proceedings at the Supreme Court of Indonesia that seek to overturn lower administrative tribunal and court decisions in relation to the revocation of four mining licenses that cover the EKCP, Churchill added.