Chinese mining company Chinalco (Xiong’an) Mining Corporation Limited has committed at least N$16.5 million (US$1 million) towards exploration and metallurgical testing at Namibia’s Opuwo Cobalt-Copper Project as it moves to acquire Celsius Resources’ majority stake in the project.
The funding forms part of Chinalco’s proposed acquisition of Celsius Resources’ 95% interest in the project and is intended to advance exploration activities while regulatory approvals for the transaction are being finalised.
Under the agreement, Chinalco will provide a minimum of US$750,000 (about N$12.4 million) for exploration activities and a further US$250,000 (about N$4.1 million) for metallurgical test work. The results will be shared with Celsius Resources and used to support the renewal of the project’s Exclusive Prospecting Licence (EPL).
“As a demonstration of its commitment to the transaction and the Opuwo Project and in support of EPL and ECC renewal applications, Chinalco (Xiong’an) Mining has agreed to provide a non-refundable exploration commitment of a minimum of US$750,000 on exploration and US$250,000 on metallurgical test work while conditions precedents are being satisfied (with the results to be provided to Celsius and to support the EPL renewal),” the company said.
The Opuwo Project is an advanced cobalt-copper exploration and development project located in Namibia’s Kunene Region.
Earlier this quarter, Celsius announced an agreement to sell its 95% stake in Opuwo Cobalt Holdings, together with an associated intercompany loan, to Chinalco for US$15 million (approximately N$247.5 million).
Chinalco (Xiong’an) Mining is a subsidiary of Aluminum Corporation of China (Chinalco) and specialises in the development of large-scale international base metals projects.
The transaction remains subject to several conditions, including approval by Celsius shareholders, renewal of the project’s Exclusive Prospecting Licence and Environmental Clearance Certificate (ECC), approval from the Namibian Competition Commission, exchange control approval from the Bank of Namibia, and the necessary regulatory approvals in China.
Celsius said the divestment would enable the company to focus on its copper-gold portfolio in the Philippines while providing funding to advance its remaining projects.
The company said proceeds from the transaction, subject to the resolution of an ongoing arbitration matter, will be used to advance the MCB Copper-Gold Project.
