Australian iron ore miner Fortescue Metals Group has announced that a judgment has been successfully awarded to Fortescue in its arbitration dispute with Armada (Singapore) Pte Ltd (Armada).
According to a Fortescue statement, Armada brought arbitration proceedings against Fortescue seeking estimated alleged damages in excess of US$70 million, after Fortescue terminated its five-year contract of affreightment (COA) with Armada in January 2009 following the global financial crisis.
Prior to the arbitration hearing, Fortescue offered to settle Armada's claim for US$4 million on a without prejudice basis. This offer was based on two shipments that Fortescue suspended in December 2008 prior to the COA termination. Armada rejected that offer and has been awarded approximately US$3.7 million for those two shipments.
In all other respects the arbitration decision fully upheld Fortescue's valid termination of the COA and as such Fortescue will be entitled to recover its costs from Armada.