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Hindustan Copper claims 'wrongful' Surda mine contract termination


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Hindustan Copper claims 'wrongful' Surda mine contract termination

Hindustan Copper Ltd. said the termination of the operation and maintenance contract for its Surda copper mine in India by India Resources Ltd. was wrongful.

The company said June 8 that it is entitled to claim damages for the breach of contract from India Resources, a special-purpose vehicle of Eastern Goldfields Ltd.

India Resources terminated the contract earlier in June saying that it had experienced a significant loss of revenue and profits due to strikes by workers over Hindustan Copper's delay in resolving issues related to the reimbursement of a 40% increase in statutory wages the government put into effect in January.

India Resources also appointed Vaughan Neil Strawbridge and Jason Tracy of Deloitte Financial Advisory Pty. Ltd. to be joint and several voluntary administrators of the company.

Hindustan Copper noted that it has made all "undisputed monthly payments" for the work at the mine.

The company further noted that India Resources' performance has deteriorated since April and that the company failed to achieve monthly production targets.

According to the company, India Resources and Eastern Goldfields have "huge outstanding liabilities in the market of more than [400 million Indian rupees] which is payable to its bankers (creditors), suppliers and wages to its employees including statutory payments."

Meanwhile, Hindustan Copper is looking to restart operations at Surda.