Rurelec Wins Historic Bolivian Compensation Award

RNS Number : 0692Z

Rurelec PLC

03 February 2014

 



 3 February 2014

Rurelec PLC

("Rurelec" or "the Company")

Rurelec Wins Historic Bolivian Compensation Award

US $41 million Due to Rurelec

Rurelec PLC (AIM: RUR), the owner, operator and developer of power generation capacity internationally, today announces that an international arbitral tribunal constituted according to the Rules of Arbitration of the United Nations Committee on International Trade Law (UNCITRAL) with a legal seat in The Hague has upheld Rurelec's claim that Bolivia's expropriation of Rurelec's 50.001% participation in Empresa Guaracachi SA on 1 May 2010 was in breach of its obligations under the Bilateral Investment Treaty between the United Kingdom and Bolivia. This is the first such arbitration award granted by an international court against Bolivia.

The Tribunal concluded that the expropriation was unlawful and calculated aggregate compensation in the amount of US$35,539,598 (approximately £21.6m) as of 31 January 2014, now increasing by daily compounded interest at the rate of 5.6331% a year until the date of payment. The award is higher than the £20.582 million which Rurelec paid to acquire its controlling stake in Guaracachi in 2006.

In accordance with the Bilateral Investment Treaty and the UNCITRAL rules, the award is final and binding on Bolivia and shall be carried out without delay. Rurelec is confident that Bolivia will comply with its obligations towards Rurelec and the United Kingdom under the Treaty and looks forward to prompt settlement of the amount awarded.

This award brings to an end a process started on 1 May 2010 when the Plurinational Government of Bolivia nationalised all of the Bolivian generation interests of Rurelec. It represents a vindication of the Rurelec management's efforts to obtain justice for its shareholders.

A further US $5.5 million remains due to be paid to Rurelec by Guaracachi itself in the form of declared but unpaid dividends going back to the time before nationalisation. This takes total payments now due to Rurelec to US $41 million (£24.9m).

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For further information please log on to our website www.rurelec.com or contact:

Peter Earl, CEO, Rurelec PLC Ana Ribeiro, Head of Communications	Tel: [phone]
Paul Shackleton & David Hart Daniel Stewart & Company Plc	Tel: [phone]
Jon Belliss & Guy Peters, XCAP Securities	Tel: [phone]
James Joyce and Nick Field W.H. Ireland	Tel: [phone]

 

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