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TAMPA, Fla., March 25, 2019 (GLOBE NEWSWIRE) -- Odyssey Marine Exploration, Inc. (NASDAQ:OMEX), a pioneer in the field of deep-ocean exploration, today provided an update on subsidiary Exploraciones Oceanicas (ExO)’s phosphate project in Mexico. Notably, Odyssey here advises of an additional legal step it has taken to defend shareholder interests and realize the full economic value in the development of the project.
As of 2012 the Mexican Government granted ExO concessions for the development of one of the world’s largest seabed phosphate deposits, more than 22 kilometers off the coast of Baja California Sur. Odyssey believes that phosphate sands extracted from the deposit could supply most of North America’s fertilizer needs for the next 100 years. Development of this resource would see Mexico, currently dependent on expensive imported phosphate, become self-sufficient in fertilizer and materially advance its domestic food security, in addition to generating substantial direct and indirect economic and strategic benefits to the country.
ExO has placed responsible environmental development of the phosphate resource at the heart of its plans. ExO spent six years working diligently and to the highest scientific standards to demonstrate that the concession can be developed in an environmentally responsible manner causing no long- or even short-term negative effects on the local marine environment. ExO worked closely with scientists from Mexico’s Ministry of the Environment (SEMARNAT), convincing them of the project’s merits. Despite this, political interference on the part of the then Secretary of the Environment, Rafael Pacchiano, led to an initial denial of approval in April 2016.
ExO appealed that negative decision to Mexico’s Superior Tribunal of Administrative Justice. In March 2018 a unanimous full bench of the Tribunal confirmed that SEMARNAT’s initial decision failed to comport with Mexican law, in that it failed to consider the actual circumstances of the project and the extensive environmental mitigation measures ExO had proposed. The Tribunal sent the issue back to SEMARNAT for a proper decision in compliance with the agency’s statutory obligations. Unfortunately, in October 2018 SEMARNAT issued a second refusal that blatantly disregarded the Tribunal’s order. This second refusal manifestly was politically rather than scientifically motivated; the then Secretary, Rafael Pacchiano, publicly announced his intention to engineer a refusal.
Odyssey has full confidence in the environmental and economic merits of its venture in Mexico. It also intends to take all necessary steps to protect this valuable shareholder asset. The past Administration in Mexico has treated Odyssey’s valuable investment in a manifestly arbitrary and discriminatory manner, in bad faith and in clear disregard of their own applicable legal regime. In these circumstances, to protect its rights and to defend shareholder value, on January 4, 2019 Odyssey formally filed notice of its intention (NOI) to file a claim against Mexico under Chapter Eleven of the North American Free Trade Agreement (NAFTA). Filing a NOI initiates a consultation period during which Odyssey and the Mexican Government will seek amicably to resolve this dispute. Convinced of the huge benefits this phosphate development project will bring to Mexico, Odyssey intends to work diligently and in good faith with President Andres Manuel Lopez Obrador’s administration to achieve an equitable resolution of this dispute. Should such an outcome not prove possible, Odyssey intends to proceed to arbitration under Chapter Eleven of NAFTA.
In accordance with its commitment to transparency in investor-State arbitration, Mexico has made Odyssey’s NOI filing available on the website of the Secretaria de Economia at https://www.gob.mx/cms/uploads/attachment/file/447269/Odyssey_NAFTA_NOI_Redacted.pdf.
“We believe that development of this strategically and economically significant resource aligns with the key objectives outlined by Mexico’s new administration to transform the economy and achieve food security for the benefit of the Mexican people,” stated Mark Gordon, Odyssey President and CEO. “Our proposals also fully comply with principles of careful environmental stewardship, consistent with Odyssey’s core values. We welcome the opportunity to work with the Mexican Government during this consultation period to find a way forward that benefits all parties.”
Odyssey's lead counsel in this matter is Christophe Bondy of the law firm Cooley LLP. Mr. Bondy is one of the world's most experienced NAFTA treaty counsel. He spent nearly a decade as lead counsel to Canada defending claims under NAFTA Chapter Eleven. For over 20 years he successfully has represented both States and investors in high-stakes investment treaty claims around the world.
About Odyssey Marine Exploration
Odyssey Marine Exploration, Inc. (Nasdaq:OMEX) is engaged in deep-ocean exploration using innovative methods and state-of-the-art technology to provide access to critical resources worldwide. Our core focus is the discovery, development and extraction of deep-ocean minerals. Odyssey also provides marine services for private clients and governments. For additional details, please visit www.odysseymarine.com.
Forward Looking Information
Odyssey Marine Exploration believes the information set forth in this Press Release may include "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. Certain factors that could cause results to differ materially from those projected in the forward-looking statements are set forth in "Risk Factors" in Part I, Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2017, which was filed with the Securities and Exchange Commission on March 26, 2018. The financial and operating projections as well as estimates of mining assets are based solely on the assumptions developed by Odyssey that it believes are reasonable based upon information available to Odyssey as of the date of this release. All projections and estimates are subject to material uncertainties and should not be viewed as a prediction or an assurance of actual future performance. The validity and accuracy of Odyssey's projections will depend upon unpredictable future events, many of which are beyond Odyssey's control and, accordingly, no assurance can be given that Odyssey's assumptions will prove true or that its projected results will be achieved.
Cautionary Note to U.S. Investors
The U.S. Securities and Exchange Commission (SEC) permits mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms in this press release, such as "measured", "indicated," "inferred" and "resources," which the SEC guidelines strictly prohibit us from including in our filings with the SEC. "Inferred mineral resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. U.S. investors are cautioned not to assume that part or all of the inferred mineral resource exists, or is economically or legally mineable, and are urged to consider closely the disclosures in our Form 10-K which may be secured from us or from the SEC's website at http://www.sec.gov/edgar.shtml.
CONTACT: Laura Barton Odyssey Marine Exploration, Inc. (813) 876-1776 x 2562 firstname.lastname@example.org