8 February 2013

Zimbabwe: Mwana Africa, Chinese Sign Pact

MWANA AFRICA, a multi-commodity African mining group listed in the United Kingdom with a strong presence in Zimbabwe, has announced the formal signing of the Joint Venture Agreement with Zhejiang Hailiang Company Limited of China. The Alternative Investment Market-listed firm controls 52,9 percent in Zimbabwe-based Bindura Nickel Corporation, Africa's only integrated nickel miner, smelter and refinery listed on the Zimbabwe Stock Exchange.

The co-operation and development agreement covers a total of 28 licences held by the multi-commodity miner in Africa the Democratic Republic of Congo southern province of Katanga.

It also owns the entire shareholding in gold mining unit Freda Rebecca. Mwana Africa continues to invest in exploration and acquisition of new assets largely in Zimbabwe and the Democratic Republic of Congo where most of the assets are domiciled.

It raised millions of dollars for the expansion of Freda Rebecca and the restart of Bindura Nickel Corporation largely due to its strong and attractive resource balance sheet.

It recently announced a 152 percent increase in the joint ore resources committee compliant nickel resource at Bindura Nickel Corporation's Trojan Nickel mine in Zimbabwe.

The total nickel resource for the Trojan Nickel Mine is now 114 952 tonnes of nickel (based on a 0,45 percent Ni cut off), compared to 45 600 tonnes previously. The overall resource grade has increased from 1,29 percent to 1,51 percent.

Mwana Africa had earlier announced on August 21 last year that it had entered into a co-operation and development agreement for 28 licences. The CDA required that the parties enter into a detailed joint venture agreement to implement the CDA.

Mr Kalaa Mpinga, chief executive of Mwana Africa, said that he was pleased that the relationship with Hailiang has progressed well with the signing of the Joint Venture Agreement implementing the Co-operation and Development Agreement signed last year.

"This joint venture allows our copper exploration and development programme in the DRC to be significantly accelerated. We are also very excited at the prospect of advancing Kibolwe in the near term.

"We look forward to working closely with Hailiang in what we expect will be a very productive relationship," said the Mwana Africa boss.

Under the agreement, Hailiang will invest US$25 million over a minimum period of four years to earn a 62 percent voting interest in the exploration joint venture.

Hailiang has the right at any time to transfer a licence into a development company. Mwana Africa's 38 percent shareholding in any development company will be non-dilutable. Hailiang has a further six-month option over the Kibolwe prospect.

Should they exercise this option, Kibolwe will be transferred to its own development company, in which Mwana Africa will have a 40 percent non-dilutable shareholding and Hailiang has committed a further US$15 million within 12 months after the transfer of the licence.

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