July 29, 2011 / 12:21 PM / 7 years ago

Court reserves judgement on $2 bln ENRC lawsuit

* First Quantum suit seeks $2 bln damages for revoked Congo asset

* Decision on jurisdiction unlikely before September - sources

* Ruling could pave way for settlement

LONDON, July 29 (Reuters) - A court in the British Virgin Islands has reserved its judgement on a bid by units of Kazakh miner ENRC to strike out a $2 billion claim filed by Canadian rival First Quantum Minerals over a disputed Congo project.

The court earlier this week heard the application to dismiss the case on grounds of jurisdiction, a petition filed by ENRC units in March, but no ruling has been given.

The dispute between First Quantum and ENRC over the copper-cobalt project, Kolwezi tailings, has emphasised the difficulties faced by miners as they are pushed into tougher regions by a scarcity of low-cost, high-quality projects, high metal prices and strong demand.

First Quantum held an exploitation licence for Kolwezi until it was revoked by the Democratic Republic of Congo government in August 2009.

In August last year, London-listed ENRC bought a majority stake in holding firms controlling the licence, effectively taking control of Kolwezi, in a move which has been fierecely criticised.

Legal sources said the court’s summer vacation meant the judgement was now unlikely to come before mid-September, though a written judgement could be circulated before then.

A decision to strike out the case would end one of several avenues First Quantum is pursuing in its search for compensation over losses in Congo and could pave the way for a settlement over machinery and equipment in Kolwezi, still technically owned by the Canadian miner.

ENRC investors will hope the start of work at Kolwezi could prompt the market to look again at ENRC assets such as its Congo deposits, which are widely recognised to be undervalued. (Reporting by Clara Ferreira-Marques; Editing by David Cowell)

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