The Canadian gold mining company at the center of a decade-long fight with Costa Rica over a controversial open-pit mining concession has ceased operations.
Infinito Gold Ltd. released a statement Wednesday saying “all of the directors of the Company and all of the officers of the Company have resigned from their respective positions with the Company effective immediately.”
Infinito listed more than $160 million in working capital deficit including loan principle and interest, according to the statement published on the Canadian commercial newswire service CNW.
“The Company has concluded that it will not be possible for it to continue operations,” the statement concluded.
Infinito’s financial troubles were well known. It’s deficit led some critics to call it a “zombie company.”
Infinito’s most recent clash with the Costa Rican government came last year when it brought a request for arbitration before the World Bank’s International Center for Settlement of Investment Disputes. The company originally said it would sue Costa Rica for $1 billion in lost profits, claiming that the country violated the Costa Rica-Canada Bilateral Investment Treaty when an Administrative Appeals Court revoked its mining concession in San Carlos, Alajuela in 2010. That amount was lowered to $94 million to recoup money lost in the development of the project.
In February 2014 Costa Rica’s then-Environment Minister René Castro said that Costa Rica would countersue for $5 million in damages.
Now that Infinito has folded, the status of that case is unclear. A search of the case on the ICSID website on July 15 listed the proceedings as pending.
The Tico Times contacted Costa Rica’s Foreign Trade and Environment Ministry for comment but did not receive a response before close of business Wednesday.
In 2008 Infinito obtained a concession to build an open-pit gold mine from the administration of President Óscar Arias. But an Administrative Appeals Court later ordered the Prosecutor’s Office to open an investigation of the president for signing off on the project when environmental studies were still pending. That case has since been closed.
In November 2010 the appeals court revoked Infinito’s gold-mining concession. The company exhausted its legal recourse in Costa Rica after it lost its appeal before the Supreme Court’s Civil and Administrative Law Branch in November 2011.
In April 2013 the company announced that it would take its case to the World Bank’s arbitration body if the two sides were unable to resolve the issue during the six-month window required under the investment treaty.