EDITOR: | October 31st, 2013 | 12 Comments

Stans Energy Commences International Arbitration against the Government Of Kyrgyzstan

| October 31, 2013 | 12 Comments
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Stans-Energy-CorpOctober 31, 2013 (Source: Business Wire) — Stans Energy Corp. (TSX-V: HRE, OTCQX: HREEF), (“Stans” or the “Company”), announces that it is formally commencing an international arbitration action against the Government of Kyrgyzstan for its expropriatory and unlawful treatment of the Company in relation to the Kutessay II rare earth project.

Since 2012, the Kyrgyz Government has taken a series of measures making it impossible to carry out activities at Kutessay II. In March 2013, the General Prosecutor’s Office of the Kyrgyz Republic (SPO) filed a statement of claim against the State Agency for Geology and Mineral Resources of the Kyrgyz Republic (SGA) to invalidate the process by which Stans acquired the mining licence for Kutessay II. Subsequently, the Inter-district Court of Bishkek issued an injunction dated April 15, 2013, which bars the SGA and its officials from taking actions related to the execution and/or extension of the Company’s licences for Kutessay II and Kalesay projects. These actions are aimed to impede the Company from executing its responsibilities under its licence and have actually created conditions for termination of the operations of Kutisay Mining LLC, the Company’s wholly owned subsidiary.

The claim seeks US$ 117,853,000 in compensation for losses and damage.

Stans Energy arbitration team will be led by Professor Igor Zenkin, recognized as one of the leading experts on International Trade Disputes within Russia and the former Soviet Republics. Prof. Zenkin is an arbitrator of the International Court of Arbitration of the International Chamber of Commerce in Paris. He is also included on the list of arbitrators of the International Commercial Arbitration Court at the Chamber of Commerce and Industry of the Russian Federation, as well as of the Arbitration Court of the Moscow Chamber of Commerce and Industry.

The arbitration which was brought by Stans and its subsidiaries will take place under the Convention for the Protection of Investor’s Rights to which Kyrgyzstan is a signatory and will be heard in the Arbitration Court at the Moscow Chamber of Commerce and Industry. Notice of arbitration has been served against the Government of Kyrgyzstan and will be available on the Company’s website in the coming weeks.

Mr. Rodney Irwin, Chairman of the Board and Interim President, states “We are disappointed in the Kyrgyz government’s lack of action in quickly resolving the outstanding claims. The impact of the recent court action has frozen all development at the project site. Under international law these actions constitute compelling grounds for the Company to seek damages in order to protect the interests of its shareholders.”

About Stans Energy
Stans Energy Corp. is a resource development company focused on progressing Heavy Rare Earth (HRE) properties in areas of the Former Soviet Union. In December 2009, Stans acquired a 20-year mining license for the past-producing Kutessay II rare earth mine from the Kyrgyz Republic. On May 26, 2011 Stans completed the purchase of the Kashka Rare Earth Processing Plant (KRP) the same plant that previously refined REEs historically from Kutessay II. The KRP was the only hard rock plant to produce all rare earth elements outside of China, producing 120 different metals, alloys, and oxides. For over 30 years, Kutessay II produced 80% of the rare earth metals for the former Soviet Union.

We seek safe harbour.

FORWARD LOOKING STATEMENTS: This document includes forward-looking statements as well as historical information. Forward-looking statements include, but are not limited to, use of proceeds from the Offering, the completion of the Offering, the continued advancement of the company’s general business development, research development and the company’s development of mineral exploration projects. When used in this press release , the words “will”, “shall”, “anticipate”, “believe”, “estimate”, “expect”, “intent”, “may”, “project”, “plan”, “should” and similar expressions may identify forward-looking statements. Although Stans Energy Corp. believes that their expectations reflected in these forward looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statement. Important factors that could cause actual results to differ from these forward-looking statements include the potential that fluctuations in the marketplace for the sale of minerals, the inability to implement corporate strategies, the ability to obtain financing and other risks disclosed in our filings made with Canadian Securities Regulators.

Raj Shah

Editor:

Raj Shah has professional experience working for over a half a dozen years at financial firms such as Merrill Lynch and First Allied Securities Inc., ... <Read more about Raj Shah>


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Comments

  • David Mortimer

    Does anyone know if this is a good move?

    October 31, 2013 - 1:49 PM

    • Tracy Weslosky

      David – I perceive it to be an excellent move and I was quite impressed by Rodney Irwin in our interview yesterday. I asked the Stans team to provide me with a more official response and this is from an email I received today: “Stans Energy remains committed to developing Kutessay II and resuming production. We have assembled a world class team of experts who not only have decades of experience in the processing of Rare Earth Oxides, these experts have actually realized saleable goods from the mineralization contained in Kutessay II. Management has made the decision to pursue international arbitration for several reasons.

      1. To provide the Kyrgyz government with stern motivation to resolve the ongoing court case quickly
      2. To establish a USD$ liability amount to ensure that the company is dealt with fairly moving forward
      3. To protect our shareholders regardless of outcome in the Kyrgyz court system.

      International Arbitration allows for a third party to provide a fair, balanced and independent view point on often complicated and intricate situations. Stans’ 100% success rate in all court cases it has been involved in, only reinforces the fact that the company is committed to long term sustainable development of a world class asset that will serve the interests of all stakeholders – both the local community, our shareholders and international firms looking to secure non-Chinese sources of rare earth elements.”

      I think you will be equally impressed when we post this interview by early next week.

      October 31, 2013 - 3:19 PM

      • Veritas Bob

        Question (not rhetorical): What teeth and leverage does the the Arbitration Court/Convention for the Protection of Investor’s Rights have over Kyrgyzstan? Is there a bias in how the court will rule, to include the significance, if any, of Moscow as a venue? If the court does rule in favor of Stans, is there any practical method for enforcing the judgment? In other words, can Kyrgyzstan just blow off any verdict, and if it does, what consequences would/might arise to Kyrgyzstan?

        October 31, 2013 - 4:33 PM

      • David Mortimer

        Thanks Tracy , I’m looking forward to reading this in the coming days , Stans share holders have been put through the ringer by the Kyrygs , it would be nice for this nightmare to finally come to an end.

        November 1, 2013 - 12:59 PM

  • Aat Oskam

    My guess is that it is a final convulsion to get out of the Kyrgyzian swamp. Imo this action is proof that Stans has given up hope to be able to produce anything at any time, and as a last resort tries to get back the money already spent on the Kutessay project.

    October 31, 2013 - 2:18 PM

    • Tracy Weslosky

      Aat. I am about to make an example out of you, and this is not what I want to do on my 12th anniversary of owning this company today. We are NOT a bullboard for emotional outbursts, nor are we a late night board for finding companionship (and yes this is a joke)…the challenges in any emerging market involves knowledgeable investors who can appreciate what high risk is. If you have a real issue, contact IR at Stans Energy; otherwise, go find another site as I will DELETE you if you cannot conduct yourself as the gentleman that I have memory of you being. Tracy

      October 31, 2013 - 3:22 PM

  • Aat Oskam

    Tracy,
    if you think I avoid risk: I have invested heavily in REE’s since long. I’ve seen the high’s and experience the (very) lows nowadays. E.g.
    I stuck to Lynas in bad times, and still do. I sincerely hope Stans will survive and become profitable, especially for their efforts and shareholders, do not get me wrong. But I very much doubt a positive outcome. I agree I was too outspoken, but political manipulations like this make me angry. I think you overreacted by alleging me of seeking companionship (even as a joke). If you still want to delete me, please do!

    October 31, 2013 - 5:00 PM

  • dennis

    Thank you for excellent post, Tracy..
    I do one question, how long do you think it will take for international arbitration,, will it held in Moscow, Russia?
    Do you think Krgy government will response to this action by STANS?
    If they do would be the last.. or would they come back again with other attack? And if STANS get into production knowing they solve this matter.. would that be a JV partner outthere?

    Thank you

    October 31, 2013 - 7:49 PM

    • Alex

      The STANS had bought Kirgizian Works when it was previouse Goverment. The problem is that after revolution in Kirgizstan new goverment absolutly not support previouse decisions. More over they think that STAN has to buy it from their goverment again.
      Kirgizstan is such country where such revolution able occur every 3-4 year, and every time new goverment will try to sold this Works again.
      So, if you accept such risk , you can work in Kirgizstan if not don’t invest.
      Many Russian companies able to buy this plant but they know such risks, but Canadian STANS think that Kirgizstan country with possibility to solve questions in Court.
      They able to solve question only buying this plant from this Goverment again.

      November 1, 2013 - 4:18 AM

  • chris m

    i would be interested to know as to what
    might be the motivations behind the actions
    of the Kyrgyzstan Government in basically
    putting a spanner in the operations of this project.

    might there not be another party behind the actions of the
    Kyrgyzstan Government ?
    (perhaps the Chinese or Russians want to take over the same project for their own benefit?)

    November 1, 2013 - 7:01 AM

    • David Mortimer

      Tracy did a very good interview with the now ex CEO Robert Mckay a nice man who had to step down due to ill health a few months back it would make the hairs stand on the back of your neck! A Chinese company is trying to take the license off of Stans and you can be sure hands have been buttered to try and do it.

      November 1, 2013 - 1:12 PM

  • Tracy Weslosky

    Thank you for the compliments and interest in Stans Energy Corp. I think Rodney Irwin does an excellent job of answering questions on the timeline for arbitration and the overall process in an interview we just posted this morning: ‘We want to develop our mine’ — Stans Energy’s Chairman discusses International Arbitration & Rare Earth Project http://shar.es/IUkDZ

    November 5, 2013 - 12:23 PM

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