Global diversified miner Berkeley Mineral Resources may secure acquire an ownership in the Luanshya copper tailings to expand its presence in the international mining industry.
The Alternative Investment Market listed tailings processing company said that it planned to extend its operations into Zambia and has entered into a shareholders’ agreement to buy 76% interest in 3 Luanshya copper tailings from Ng’wena Mining Resources for USD 6 million. The intentions come on the heels of the completion of the exclusivity period granted to Berkeley by a memorandum of understanding signed by the two companies in May 2011.
The statement said that the deal will be finalized after Berkeley receives the remaining information from Ng’wena to complete due diligence. Proactive investors, an agent for the miner is a leading multi media news organization investor portal and events management business housed in among other cities, New York, Sydney, Toronto, Frankfurt and London.
According to the assessments undertaken at the project, the 3 dams, Old Dam, Chonga Dam and Akatiti Dam, contain tailings from the formerly operating Roan Antelope copper mine which has been operational since 1936. The project being sought is located just 90 miles north of the Kabwe closed lead zinc silver mine where Berkeley has acquired the remaining tailings dam. The impending acquisition of the asset has cheered the company and has future plans for the project to ensure that copper and other base metals are extracted to foster the company’s global reputation in the international mining arena.
Masoud Alikhani company chairperson said that “Our interest in securing further substantial tailings resources has been confirmed by the due diligence we have carried out to date. We expect to be able to resolve the remaining points in the near future which will allow us to expand what is already a significant asset base."
Accordingly, Berkeley Minerals will be tasked to pay Ng’wena USD 1.25 million on completion of the sale and the remaining USD 4.25 million in 2012. It is not clear how much reserves are at the Luanshya project. However, a report prepared in compliance with the globally recognized JORC standard in 2008 estimated the indicated resource at the three dams at Luanshya at 162 million tonnes of tailings material grading 0.24% copper, containing 380,700 tonnes of copper.
In a related development, Berkeley may prepare the Kabwe tailings for processing to sell them on world markets to meet the demands of the potential investors who are presently waiting for a new JORC compliant resource statement for Kabwe, which should be available by the end of July.
China’s Non Ferrous Metals Africa Corporation acquired Luanshya copper mine at USD 50 million more than two years ago and has to date invested more than USD 300 million in operations at the mines which include rehabilitating the hoist system to boost copper production underground especially from Baluba.
Additionally, China Non Ferrous has staked USD 400 million to set up a Greenfield Mulyashi Open Pit Mine which is expected to be completed and commissioned by December 2011 and is forecast to produce 60,000 tonnes of finished copper when operational with 1,000 jobs to be created at the mine.
Luanshya Copper Mines was wholly owned by Zambia Consolidated Copper Mines, once a conglomerate until at the time of privatization in the late 1990s when mines where unbundled into separate units to pave was for privatization of the sector. The decision by the government, also ostensibly, saved the government of about USD 1 million used daily to sustain the mines that were dormant and not producing copper for lack of re capitalization.
Most of the mines were vulnerable to flooding if no operations were taking place because of their nature, prompting the government to incur costs on care and maintenance.
(Filed by Mr Kapembwa Sinkamba SteelGuru Correspondent Zambia)
