Canadian company World Wide Minerals has failed in its arbitration against the Republic of Kazakhstan and the country's nuclear agency NJSC Kazatomprom (KAP). This means that World Wide has been unable to complete and file audited financial statements for the year ended December 31, 2010 and to file them with the securities regulators by the deadline of May 2, 2011.
World Wide is therefore in default of the requirement to make the filings and as a result, the Ontario Securities Commission on May 9, 2011 issued a temporary Cease Trade Order (CTO) ordering that all trading in securities of the company, whether direct or indirect, cease for a period expiring May 24, 2011 at which date the CTO will become permanent unless the default is rectified.
The company knows of no basis upon which the current default can be rectified at this time and therefore expects that the CTO will become permanent on May 24.
The company reports the resignation of two of its five directors, Patrick Raleigh and Robert Granger. Company president and CEO Paul Carroll says, “I regret that circumstances have resulted in these valuable directors retiring but on behalf of the shareholders I would like to thank them for their years of uncompensated service.”
World Wide went to Kazakhstan in 1996, did its due diligence and entered into a management agreement with the government with an option to purchase the TGK uranium assets at Stepnogorsk. At the urging of the government, the company also entered into a strategic alliance agreement with KAP to enter into a 50/50 joint venture with KAP to develop and operate several uranium mines and deposits.
The opportunity to implement that investment strategy was thwarted by the government in mid-1997 and the assets and opportunity were confiscated by the government without compensation.
The company says that with the failure in the arbitration it has reached the end of the road. “We will consider whether there are any new opportunities for the company and its shareholders but the chances are slim to none.”
Paul Carroll says, “We wish to thank the thousands of long-suffering shareholders and other stake holders in this ordeal. We would have liked to have been able to report a much more favourable outcome - but it was not to be.
“We have had many supportive comments from our shareholders and I would like to quote from one of the many received in the last week: ‘I'm still in shock! This news has come as an extreme blow... I could not imagine that the arbitrator could ignore the injustice faced by World Wide Minerals. How can a country give permission to allow mining and then tell the company you can't export what you've mined? They used the company to do all the legwork and reaped all the rewards!’ Sad but true.”
The company will now consider whether there is any chance that it can be restructured and re-launched to develop a new project.