Arcelormittal has agreed to pay Senegal $150-million in cash as damages to settle a dispute with the West African nation over the failed Faleme iron-ore mine deal, Senegal's government spokesman said on Friday.
Senegal had been seeking $750-million in damages after winning a case at the International Chamber of Commerce's arbitration court in Paris. The court ruled in September that Senegal was within its rights to cancel the 2007 deal due to long delays.
Abdoul Latif Coulibaly, Senegal's minister for good governance and government spokesman, told Reuters ArcelorMittal would also hand over the equivalent of $50-million worth of research on the site to its next operator.
"ArcelorMittal and the government of Senegal have agreed to negotiate in order to end the conflict,' Coulibaly said.
A spokesperson for ArcelorMittal in London declined to comment.
ArcelorMittal had initially planned to invest $2.2-billion in the project, including the construction of a new port near the capital Dakar and a 750 km railway line. The mine, in the country's far east, is estimated to contain 750-million tonnes of reserves.
However, the project was suspended after the global economic crisis struck. The government has said it has received several bids from firms interested in taking over the project.