II:China's GMR To Take 25% Stake Of Mineral Hill Copper Mine
China's Guangdong Guangxin Mining Resource Group, or GMR, has signed a memorandum of framework cooperation with Australia's KBL Mining for taking a 25% interest in the latter's Mineral Hill copper project in New South Wales.
Under the MOU, GMR will pay A$80 million ($80.6 million) for the purchase of a 25% joint-venture interest in KBL's wholly-owned Mineral Hill mine, including the Iron Duke exploration license.
As part of the deal, the Chinese party will be entitled to offtake all of KBL's remaining 75% share of Mineral Hill's life-of-mine copper concentrate output at a 25% discount to prevailing LME prices.
The MOU package also covers the subscription by GMR for a 15% fully diluted shareholding in KBL, formerly known as Kimberley Metals. Completion of the transaction is conditional upon approvals from the Australian and Chinese governments.
GMR, a subsidiary of state-owned Guangdong Guangxin Holding, the largest foreign trade group in the prosperous Guangdong province in South China, is the major platform for the parent company's mining investments. The funds generated would be utilized by KBL in expanding and upgrading the Mineral Hill project; exploring other gold and copper targets and advancing the Iron Duke copper-gold project 50 km northeast of Mineral Hill.
The newly recommissioned Mineral Hill mine shipped its first cargo of copper concentrates in October to China's third-largest copper smelter Yunnan Copper, which has received three Mineral Hill shipments so far totaling 2,707 tonnes. A fourth shipment to Yunnan is scheduled to depart on Thursday, 29th December.
The Mineral Hill refurbishment project includes a copper concentrate plant with ore processing capacity of 250,000 tonnes per year. KBL is targeting a 10% increase in mill feed to 275,000 tonnes per year from January, which is expected to boost copper metal production from 4,900 tonnes per year to 5,200 tonnes per year in concentrate.
The Mineral Hill mine was idled in 2005 after producing a total of 2.1 million tonnes ore at 6.5 g/tonne gold and 1.14% copper.
