ATOME PLC Initiates Arbitration Against Paraguay Over Villeta Project

The dispute centers on the government’s alleged breach of the UK-Paraguay Bilateral Investment Treaty. ATOME, represented by White & Case LLP, contends that the cancellation of decrees governing the Power Purchase Agreement stripped the project of necessary price and term certainty. While the company maintains that it remains open to an amicable resolution, the filing establishes a three-month window for negotiations before the case moves to the International Centre for Settlement of Investment Disputes in Washington D.C.

This project represents the largest single foreign industrial investment in Paraguayan history, backed by an international consortium including the IFC, the European Investment Bank, and the Inter-American Development Bank. The Villeta facility was designed to produce green fertiliser for the Mercosur market, with a 10-year offtake agreement already signed with Yara International. Beyond the financial implications, the project was projected to generate 4,000 construction jobs and over 1,000 operational roles, while significantly reducing the regional agricultural sector's reliance on fossil-fuel-based imports. ATOME confirmed that its other international projects remain unaffected by the current legal action.