SNC Lavalin reaches settlement over Chile mining contract termination
The Canadian PressIndustry Mining & Resources
MONTREAL – SNC-Lavalin Group Inc. says it has reached a settlement with Chile’s state-owned copper mining company about its decision last March to terminate a US$260-million mining and metallurgy contract.
No financial details were provided but the Montreal-based company said the settlement will have no material impact on its previously reported results and will eliminate the potential for any future risk.
The settlement with Codelco includes the immediate termination of all arbitration procedures and follows its decision to exit lump-sum turnkey or fixed-price projects – where the bid winner eats any cost overruns.
SNC interim CEO Ian Edwards said in a news release that settling outstanding claims is a key priority while it focuses on completing outstanding projects.
Derek Spronck of RBC Capital Markets says he wasn’t anticipating any Codelco compensation but the settlement removes the potential for additional Codelco-related losses in subsequent quarters.