Mitsubishi Materials Formally Enters Similco Cu Mine Redevelopment

Mitsubishi Materials announced on Thursday the firm decided formal participation in cooperative redevelopment project of Similco copper mine, Canada with Copper Mountain Mining Corporation (CMMC), Canadian mining company. Mitsubishi Materials concluded concerned contracts with CMMC effective on 31 July. Mitsubishi Materials enters the project through a special purpose company (SPC), which will be established in British Columbia, Canada.

Mitsubishi Materials and CMMC concluded a memorandum of understanding (MOU) for the project on 30 September, 2008. They have talked on the details of the redevelopment plan.

Based on the MOU, Mitsubishi Materials will subscribe for newly-issued shares of Similco Mines, CMMC’s wholly owned company for the project, and acquire a 25% equity interest in Similco Mines for C$ 28.75 million (approximately 2.3 billion yen). Mitsubishi Materials will also arrange C$250-million loan for the project.

Similco’s copper concentrate output will be approximately 150,000 tonnes per annum, all of which will be purchased by Mitsubishi Materials. The mine will restart operation in mid 2011.

The mine is expected to hold 211-million-tonne minable reserve at 0.36% copper grade. To estimate Similco’s operating period at 17 years, the total output could reach 670,000 tonnes for copper, 14 tonnes for gold and 140 tonnes for silver. An initial expense is C$ 460 million.