Ovoca Gold deflated by long-running legal battle to secure Russian debt
Irish firm has been in protacted legal battle to secure funds from bankrupt Russian firm
Ovoca is primarily is a gold exploration and mine development firm with a portfolio of “gold properties” in the Magadan region of east Russia. Photograph: Reuters
Irish mining firm Ovoca Gold appears to be losing its legal battle to secure money owed to it by Taymura, the now bankrupt Russian oil and gas firm, judging by the comments from its chief executive Kirill Golovanov.
“I write to you with optimism, as well as weariness,” Mr Golovanov said in a letter to shareholders accompanying Ovoca’s latest annual report.
“Regarding the latter, Ovoca has been in a protracted legal fight concerning the Taymura oil assets in Siberia,” he said.
“ In the course of the legal proceedings the courts have made several decisions with which we strongly disagree, but which has changed the direction of proceedings in an unfavorable direction” Mr Golovanov said.
“Of course management has a fiduciary responsibility to pursue the company’s claims as far as possible, but the outlook for a successful conclusion to these proceedings looks poor,” he added.
According to its annnual report it had net assets worth $27 million (€23 million) at the end of the last year, including cash reserves of $6.6 million and available financial assets of $19 million.
Mr Golovanov said the board was continuing to review the strategic direction of Ovoca to utilise its liquidity to maximise shareholder value.
“This could include a shift in direction with changes to business focus and composition of the team,” he said.