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:: Minmet Acquires Pioneering Gold Biotechnology Process
Minmet, the international mining and exploration company, announces that it has entered into a heads of agreement to acquire the biotechnology intellectual property rights together with gold-producing project assets from European Metals and Minerals Limited (EMML).
EMML is a private company, identified and promoted by MinMet non-executive director Prof. Michael S. Johnson, specializing in the development of advanced biotechnology for the recovery of precious metals from mine concentrates, tailings and mineral ores that are resistant to normal processing methods. EMML has developed non-hazardous bacterial processing methods that differ from others by requiring negligible capital expenditure and having low operating costs, typically 70% less than established pressure leach methods.
The total potential consideration for the Acquisition is approximately £3.1 million, £2.1 on completion and £1m deferred. Payment of the initial consideration of approximately £2.1m will be made by MinMet by means of £440k in cash and the issue of 33,200,000 new shares on completion. Deferred consideration of a further £1m in cash or shares, at MinMet’s option, linked to specific annual gold production targets agreed with EMML, will commence in 2004 and the project is targeted to end in 2007.
MinMet will acquire world wide exclusive rights to the Technology and intends to pursue an active programme of resource identification, research testing and technology development to generate a rolling sequence of low cost production of gold from suitable sites. This will be by means of a programme of site acquisitions and joint ventures with the owners of resources receptive to the EMML process, initially in northern and central Europe.
The Suior Project, Romania
In addition the Acquisition includes a gold producing asset where the Technology is currently being licensed. EMML has agreed an initial royalty agreement with SC Transgold SA (“Transgold”) to licence the Technology in the processing of 600,000 t of high grade, gold-bearing pyrite concentrate (“Suior”) located at Baia Mare, northern Romania. Following pilot scale testwork on the Suior concentrate EMML has verified the ability of the Technology to increase the recovered gold from less than 1 g/t (using conventional cyanidation methods) to greater than 5.5 g/t Au after bio-oxidation pre-treatment by EMML. EMML has agreed a royalty rate of between US$8/t and US$12/t of treated concentrate with further revenues potentially accruing linked to the performance of the Technology. The Acquisition gives MinMet full benefit of the net cash flow to be generated from the Suior project in royalty income commencing in September 2003. Processing of the treated concentrate will be carried out at the Transgold CIL plant at Baia Mare. The Suior project has clear title, environmental and operational permissions from the Romanian regulatory authorities and initial production commenced on 8 September 2003.
Michael Nolan, MinMet's Chief Executive said, “This exciting acquisition of a breakthrough technology will add further gold-producing capacity to MinMet following the recent purchase of the Björkdal mine in Sweden. EMML has proven biotechnology that is ready for immediate commercial use and which diversifies the producing assets of MinMet to a mix of conventional and new technologies. I am confident that this will enhance our competitiveness and capacity to engage in profitable joint ventures across Europe and beyond."
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