Myanmar Metals (MYL) and its local partner Win Myint Mo Industries (WWM) have secured East Asia Power (Mining) Company Limited (EAP) as a project-level investor in the development of the global tier-1 polymetallic Bawdwin Mine.
|A diamond drilling programme is underway at Bawdwin|
|An overview of the Bawdwin pit|
In a transaction that substantially de-risks the future development and financing of Bawdwin, MYL has agreed to terms with EAP, where EAP effectively acquires a 24.5% share of the Bawdwin Concession and Mine in return for reimbursing MYL’s costs to date on a pro rata basis. This reimbursement equates to approximately US$1.4 million, with EAP’s pro rata contribution to all future costs, including the Bawdwin option exercise fee of US$20 million.
The final post-option exercise ownership of equity in Bawdwin between the three parties will be MYL 51%, EAP 24.5% and current shareholders WMM 24.5%. This places total ownership by local Myanmar companies at 49%, with MYL retaining a majority interest and management control over the construction, development and operation of Bawdwin.
Myanmar Metals CEO John Lamb sees EAP’s investment in Bawdwin as a very significant development for MYL.
“It de-risks the project considerably. We now have two well recognised and respected local Myanmar companies that will both hold large stakes in the Bawdwin concession,” said Mr Lamb.
“Their participation will assist immeasurably with Bawdwin’s development. It gives us excellent in-country connections and recognition, and means that a large percentage of Bawdwin’s ownership stays within Myanmar. It is the right model for a foreign company like MYL investing in such a rapidly emerging and fast-growing economy.”
EAP was established in 2006 for the sole purpose of acquiring and developing mineral resource projects in Myanmar.
EAP owns and operates a manganese mine and a coal mine in Myanmar and also manages the operations of the Longh Keng high grade zinc mine and Lashio zinc refinery on behalf of Cornerstone Resources Myanmar Limited; shareholders of which include Mark Creasy’s Yandal Investments. Its mining expertise is significant.
Next Steps on Bawdwin Project
A diamond drilling program is underway at Bawdwin. This drilling initially targets the ‘starter pit’ and will lead to an update of the Mineral Resource estimate by the end of Q2 2018, with the aim of reclassifying a significant proportion of the Mineral Resource within the initial open pit as indicated.
This will lead to an updated Scoping Study, which will also incorporate results of metallurgical test-work that is currently underway.
The Company is focused on exercise of the option by 21 May 2018. Thereafter, a bankable feasibility study will be prepared.