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South Africa: Metorex's Congo Copper Tests 'Exciting'
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Business Day (Johannesburg)
17 January 2008
Posted to the web 17 January 2008
Charlotte Mathews
Johannesburg
DIVERSIFIED miner Metorex would release the results of its drilling at the Musonoi copper deposit in the Democratic Republic of Congo by the end of next month, and indications were that it was a "very exciting" ore body, Metorex chairman Simon Malone said yesterday.
He told the group's annual general meeting the Musonoi project was close to the two big deposits the group was mining at Kolwezi. The Kolwezi ore body was enormous, but Musonoi was not as big, he said .
Turning to the group's other exploration projects, Malone said a $1m drilling programme had been completed at Kasempa, but results were not as hoped and the project would have to be re-evaluated. Two other exploration projects were under way and results were not yet available. "Don't expect a hit on every exploration project," he said
All the group's operations were performing well, with record production months for fluorspar, and the Chibuluma and Ruashi projects were running smoothly from a technical perspective.
"Commodity prices have stayed high and our view is that in the medium term prices will remain firm," Malone said. "There are some pressures from the subprime mortgage crisis that will affect supply and demand but we are not pessimistic about commodity prices."
The group had a "sexy" pipeline of future projects, he said, and shareholders could look forward to more corporate activity this year.
Malone said Copper Resources Corporation (CRC), for which Metorex is bidding, had two significant copper deposits and a mine that Metorex would reopen in the next 18 months to two years. Metorex is offering to acquire CRC shares for Metorex shares or 125,1p in cash.
Asked whether Metorex would proceed with the acquisition if it did not secure 50% acceptance from CRC shareholders, Malone said Metorex had firm commitments that would bring its stake in CRC to 45% and it could roll over its 5% in Minière de Musoshi et Kinsenda into an additional 5% stake in CRC.
It could also continue buying shares in CRC on the same terms and conditions after the offer closed, and was confident CRC's share price -- more than 170p -- would fall after the closing date.
Metorex CEO Charles Needham said after securing 50% of CRC, Metorex would consider changing the corporate structure.
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It definitely did not want to retain another separately listed subsidiary.
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