Southeast Asia Mining Corp’s (SEA) joint venture partner has agreed to an extension of the second option payment from January 31, 2014 to July 15, 2014 as required pursuant to its joint venture agreement. SEA may exercise the second option by making a US$2.5 million payment to its JV partner prior to July 15, 2014.
The JV agreement gives SEA an option to earn an 80% interest in the mining lease applications of the Song Toh and Boh Yai historical operating silver-lead-zinc mines, flotation plant and equipment.
Upon making the payment, SEA will have earned an 80% interest in the mining lease applications and will assume operatorship of the project. The mining lease applications will be effectively transferred to a newly incorporated company, Southeast Asia Mining Company Limited which is controlled 80% by SEA and 20% by its JV partner.
The company continues to focus on potential strategic relationships with multiple parties and will continue to monitor the availability of traditional equity financing.
The mines were operated by Cominco in 1948, explored and operated by the German mining company Metalgesellschaft to 1990, and subsequently by a Thai private company (Kemco) until 2002 when they were closed due to depressed metal prices. Historically the mines processed about 5.4 million tonnes of ore producing 520,000 tonnes of lead and zinc concentrates at the 1000 tonnes/day flotation plant. The plant was refurbished in 2008 by SEA and its joint venture partner when approximately 60,000 tonnes of ore were processed.
SEA completed an NI 43-101 compliant Preliminary Economic Assessment for the deposits which indicated a pre-tax NPV of $88.8 million and an IRR of 148% for 100% of the historical mines.
The company also has a 100% interest in three special prospecting licences and seven special prospecting licence applications surrounding the Song Toh and Boh Yai mines and two special prospecting licence applications for copper-gold exploration in the Province of Lopburi and Nakon Sawan within the area of the Loei-Phetchabun Gold Belt.