SYDNEY (AFX) - China Metallurgical Construction Corp (CMC) will exercise its right to take up an 85 pct interest in Papua New Guinea's Ramu nickel-cobalt project, project partner Highlands Pacific Ltd said.
It said CMC's decision follows an agreement signed in March under which the Chinese state-owned company had the option to take the majority interest in the undeveloped project.
Under the deal, Highlands Pacific will retain an 8.56 pct carried interest in Ramu, increasing to 11.30 pct at no cost after the debt for the financing of the project has been repaid with the right to move to 20.55 pct by buying an additional 9.25 pct at market value.
CMC is responsible for financing 100 pct of the project which it will manage.
It will also have the right to purchase 100 pct of the nickel and cobalt produced on an arm's length basis.
Highlands Pacific chief executive Ian Holzberger said CMC's decision to exercise its right is a major milestone in the development of Ramu and for the PNG economy.
Ramu is a large "wet tropical" laterite nickel/cobalt project located in the Madang Province of PNG, containing an estimated 143 mln metric tons of ore grading 1.01 pct nickel and 0.10 pct cobalt.
The project has a mine life in excess of 20 years based on forecast annual production of 33,000 tons of contained nickel per annum.
bruce.hextall@xfn.com
blh/dk
For more information and to contact AFX: www.afxnews.com and www.afxpress.com
It said CMC's decision follows an agreement signed in March under which the Chinese state-owned company had the option to take the majority interest in the undeveloped project.
Under the deal, Highlands Pacific will retain an 8.56 pct carried interest in Ramu, increasing to 11.30 pct at no cost after the debt for the financing of the project has been repaid with the right to move to 20.55 pct by buying an additional 9.25 pct at market value.
CMC is responsible for financing 100 pct of the project which it will manage.
It will also have the right to purchase 100 pct of the nickel and cobalt produced on an arm's length basis.
Highlands Pacific chief executive Ian Holzberger said CMC's decision to exercise its right is a major milestone in the development of Ramu and for the PNG economy.
Ramu is a large "wet tropical" laterite nickel/cobalt project located in the Madang Province of PNG, containing an estimated 143 mln metric tons of ore grading 1.01 pct nickel and 0.10 pct cobalt.
The project has a mine life in excess of 20 years based on forecast annual production of 33,000 tons of contained nickel per annum.
bruce.hextall@xfn.com
blh/dk
For more information and to contact AFX: www.afxnews.com and www.afxpress.com
© 2005 AFX News