Red Rock receives payment order for VUP project
Natural resource development company Red Rock Resources has obtained an order from the Commercial Court in Lubumbashi, in the Democratic Republic of Congo (DRC), instructing VUP SA, the company’s joint venture (JV) partner in the VUP project, to pay $2.5-million as a principal amount to Red Rock.
The company’s claim for interest and damages of $11-million was heard on January 6, with a judgment expected within eight days.
As announced in 2019, Red Rock, through its local subsidiary had signed a JV agreement with VUP formalising a JV over certain copper/cobalt in Katanga and requiring the setting up of a JV company, and at the same time had signed the statutes of the JV company. Red Rock owned 50.1% of the JV and of the designated JV company.
It recently came to the attention of Red Rock that its local partner VUP on October 20, 2021 served a Procès-Verbal de Saisie-Attribution de Créances (similar to a garnishee order) on parties including Kamoto Copper Company, claiming a principal sum of $15-million in respect of a purported surrender by VUP of the JV Assets and some others, for $20-million compensation, to La Générale des Carrières et Mines (Gécamines), a State-owned company in the Democratic Republic of Congo, under the terms of a purported Amicable Termination Transaction Protocol.
Red Rock has been seeking advice in the Congo and in London on the various remedies available to it, and has obtained orders against VUP and others in the Congo which protectively seize 50.1% of the $5-million understood to have been paid so far, and which now instruct VUP to pay Red Rock $2.5-million.
“On the legal side with the VUP joint venture, there has been no let-up in the pressure we are applying, with hearings on 22 December 2021 and 5 January 2022. We advance step by step, rapidly, methodically, and on the best advice we can obtain. Every local judgement has been in our favour.
“We are glad to have received further vindication of our position in the payment order from the court which we announce today, though . . . there is a difference between getting a judgment and receiving funds,” chairperson Andrew Bell comments.
Red Rock says it continues to investigate additional remedies that may be available to it in the DRC and elsewhere.
Meanwhile, at its 80%-owned Red Rock Galaxy project in Luanshimba, results from the recent drilling programme have been received from the laboratories of ALS Global, are being analysed and will be announced shortly.
“We continue discussion on some potential cooperations, after activity wound down over the Christmas and New Year period, and await the final interpretation and analysis of the recently received drill results from our promising copper/cobalt project near Lubumbashi,” says Bell.
