China moves on Burma and rescues foundering Kenya project

CNMC to kick off construction on Myanmar nickel mine in H2

Interfax China Metals and Mining

1st August 2008

China Nonferrous Metal Mining Group Co. Ltd. (CNMC) will commence construction on its $800 million Tagaung Taung nickel mine project in Myanmar in the second half of this year, a company official told Interfax on July 30.

CNMC's subsidiary CNMC Nickel Co. Ltd. signed a production sharing contract with the Myanmar state-owned No.3 Mining Enterprise on July 28 in Naypyitaw, Myanmar's administrative capital.

"The two companies have reached a production sharing agreement for once the project starts operation," an official surnamed Wang, with CNMC's press department, told Interfax.

However, Wang declined to disclose what share of the output CNMC could off-take under the agreement, referring to commercial secrecy.

"CNMC is responsible for all investment in the project, while the No.3 Mining Enterprise will contribute its mining rights to the Tagaung Taung nickel mine," Wang said.

Local government authorities granted an investment permit and a mining license to CNMC during the signing ceremony for the project.

As Interfax reported previously, CNMC reached a joint venture agreement with the No.3 Mining Enterprise to develop the Tagaung Taung nickel mine in July 2004, in which CNMC would hold a 75 percent stake and the mining company would take the remaining 25 percent stake.

The Tagaung Taung nickel mine project, consisting of mining and smelting facilities, is designed to output 85,000 tons of ferronickel and 22,000 tons of nickel per annum. The project is scheduled to start operation in 2011, and has been granted a 20-year service period by the Myanmar government.

Jinchuan Group to invest $25 mln in Kenyan titanium project

Interfax China Metals and Mining

1st August 2008

Jinchuan Group Ltd. has signed a memorandum of understanding with Toronto-listed Tiomin Resources Inc. to invest RMB 170.88 million (US $25 million) into the Canadian company's Kenyan titanium project, Tiomin announced on July 29.

The MOU states that Jinchuan Group will directly invest in Tiomin Kenya Ltd., a wholly owned subsidiary of Tiomin that owns 100 percent of the Kwale Mineral Sands Project, in return for a 70 percent interest in Tiomin Kenya.

Jinchuan Group has pledged to finance the construction, development and operation of the Kwale project.

"The deal, still subject to shareholder and regulatory approvals, is expected to close by Nov. 1, 2008. Jinchuan Group will only be involved in the Kwale project and will not buy into the Toronto-listed company," a Jinchuan Group official close to the deal, surnamed Wu, told Interfax.

Wu said that Jinchuan Group will work on the project development plan. Tiomin's Kwale project development was previously delayed in December 2006 due to the Kenyan government restricting access to the project site.

"This transaction is extremely important for Tiomin and removes the cloud of uncertainty [surrounding the Kwale project]. Jinchuan Group is a very strong partner and we are confident that the project will be underway as soon as possible provided that we close satisfactorily," Robert Jackson, president and CEO of Tiomin, was quoted as saying in the announcement.

The Kwale Mineral Sands Project is located approximately 40 kilometers south of the city of Mombasa and contains 254 million tons of titanium sand reserves.

Jinchuan Group, China's largest producer of nickel, cobalt and platinum, specializes in mining, smelting, refining and chemical engineering. The company produces nickel, copper, cobalt, precious metals and nonferrous metals. Jinchuan Group's output of platinum group metals and nickel metal makes up 90 percent and 88 percent of China's total annual production, respectively.