Canadian miner Sherritt International stops plan to dissolve Cuban joint venture

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TORONTO (AP) — Canadian miner Sherritt International Corp. announced Tuesday it is no longer pursuing a plan to dissolve its Cuban joint venture, reversing a decision it announced last week amid expanded U.S. sanctions on the country.

The company, which has a 32-year presence on the island, said it stopped the dissolution plan after ongoing consultations with its advisers, stakeholders and governmental authorities and after acquiring additional information.

Canada is Cuba’s second-largest source of direct investment, with investments in mining, power, oil and gas.

The Toronto-based company said it has been presented on a preliminary basis with “a potential value preserving opportunity” that it is evaluating but there is no guarantee of if and when this would move forward.

Sherritt and the General Nickel Co. S.A. of Cuba each hold a 50% interest in the Moa joint venture, which mines nickel in Cuba that is shipped to Canada where it is refined.

The company is maintaining its suspension of direct participation in joint venture activities in Cuba that it announced in early May after the U.S. ramped up pressure on the Caribbean country.

Sherritt said it still faces a number of acute operational, financial and legal difficulties including the ability to comply with its debt covenants as it works to address the expanded sanctions.

U.S. Secretary of State Marco Rubio has defended the Trump administration’s decision to slap new sanctions on Cuba.

Cuban authorities maintain that the sanctions constitute “collective punishment” designed to strangle the island’s economy, arguing the Trump administration’s policies show a disregard for the welfare of the Cuban people in favor of political leverage.

The new sanctions on Havana come under the weight of a U.S. energy blockade that has caused sweeping water and power outages along with severe gas and water shortages.

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