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Dispute Resolution Provisions in Mining Agreements

Michael S. McCarthy, Donald A. Burkhardt, Frederic K. Conover, II, Mining Agreements III

Traditionally, disputes arising out of commercial contracts, including mining agreements and other natural resource contracts, have been resolved by means of formal or informal negotiation, arbitration and litigation. As mining agreements, and the relationships reflected therein, have become more complex, the resolution of disputes arising from those agreements and relationships has become increasingly complicated, expensive and time-consuming. As a result, more attention is being given to the avoidance of disputes and the efficient resolution of disputes through careful drafting and negotiation of mining agreements and through inclusion of dispute resolution provisions.

Other than negotiation, litigation is perhaps the most widely recognized and most frequently invoked method of commercial dispute resolution. There are, however, numerous other methods for resolving disputes which are finding increasing acceptance in many commercial contexts. This paper will focus on the use of alternative dispute resolution methods in mining and other natural resource agreements. The paper will briefly examine the types of dispute resolution provisions that may be incorporated into mining agreements, will address considerations that should go into negotiating and drafting such provisions, and will discuss what should be contained in these provisions.