The dispute revolved around a valuation of 24.5% of the project made by Aquila and Royal Bank of Canada which was $213 million higher than the $117 million valuation provided to Vale by Citigroup.

Vale disagreed that a third valuation should be sought as per the joint venture agreement if there were variations of more than 10% and commenced proceedings in the Queensland Supreme Court.

These proceedings commenced by Vale have been struck out by Queensland Court of Appeal, making way for the third valuation within 20 business days.

“Whilst Aquila welcomes the Court of Appeal’s decision it is disappointed that time and money has been expended in hearing this matter following Vale’s exercise of the option on 2 June 2010 rather than following the process for the resolution of differences in the two valuations that the parties agreed when they entered into the JVA,” it said in a statement.

Aquila’s preference had always been for the fair market value determination process to move forward to the determining valuer stage (given that the initial valuations differed by more than 10%) so that the exercise of the option by Vale could be completed however, to date, Vale’s court action had delayed this process, the company said.

“As the JVA requires the parties to at all times act in good faith, in the best interests of the joint venture and in accordance with the joint venture principles, Aquila trusts that Vale will now join with Aquila to progress the appointment of a determining valuer without further delay,” Aquila said.

“Once appointed, the determining valuer must make a final determination of the fair market value within 20 business days, which will then allow the parties to move towards completion of the exercise of the option and receipt of the sale proceeds by Aquila.”

Comment was not received by Vale at the time of publication.