Sydney-based International Base Metals Limited (IBML) will sell $30 million in shares to Heilongjiang Heilong Resources Investment, securing a cornerstone investor for the company which will enable expansion of the first stage of its Omitiomire copper project. Heilong is a privately owned Chinese mining company with copper and gold operations (Baoshan, Tongshan and Duobaoshan) in China’s Heilongjiang province.
The $30 million payment will be made in two tranches before June 13, 2013. IBML’s managing director Frank Bethune says, “We are delighted to have attracted a partner of the calibre of Heilong. We believe that together the funds from Heilong and their expertise in brining mines into production will be an impetus for driving value for all IBML shareholders.
“The funds will go towards establishing a Stage 1 oxide copper mining and processing operation at Omitiomire, expanding the JORC-compliant resource and selective farm-ins to other exploration assets in Namibia,” he says.
Heilong currently holds a 6.3% interest in IBML and is a related party of West Minerals which holds a 30% stake. Once the transaction is complete Heilong and West Minerals will hold a combined 53.9% share in IBML.
Under the share subscription, Heilong will have the opportunity to nominate and have appointed one person as a director of the Board. The sale is subject to approval from the Chinese government and other authorities.
IBML owns the Oitiomire copper project and a large portfolio of highly prospective exploration tenements, through its wholly-owned Namibian-registered subsidiary, Craton Mining and Exploration.
The Omitiomire deposit contains a resource in excess of 700,000 tonnes of contained copper metal. An updated resource assessment, completed in August 2012, identified the potential to expand the resource to more than 1.2 million tonnes of contained copper.
IBML is considering a two-stage approach to bring Omitiomire into production, with phase 1 being a small project based on the near-surface oxide copper resource and phase 2 encompassing a larger project based on the deeper sulphide copper resource.