C'mon boyz. Secure an off-take agreement!!!! That would spark some serious interest and increase in sp. Wonder why and how they did it in the past but have yet to come thru when they are soo close? I sure hope there is more to the financing than meets the eye. The part in red definitely caught my eye. Not hard to do the math with a current outstanding shares of around 370 million. Add in the iron ore and you never know
• Shareholder Value Preserved By Maximum Exposure To Moly Price
• Agreement Sends “Powerful Message” To Financial Community – CEO
• Spinifex Ridge On Track For Commissioning In Second Half Of 2009
In a major step forward for development of its Spinifex Ridgemoly-copper project in the Pilbara District of Western Australia, MolyMines Limited (ASX, TSX: MOL) has signed a 10-year offtake agreementwith ThyssenKrupp Metallurgie Gmbh (TKMet) of Germany for all of itsshare of the planned molybdenum production from the mine.
At the planned moly production rate of 24m lb/y and based on currentmoly prices, the value of the agreement is approximately US$7bn.
TKMet has also agreed to participate in the equity financingcomponent for the A$1.1bn Spinifex Ridge project, subject to finalThyssenKrupp Board approval.
Commenting on the agreement, Dr Derek Fisher, chief executive of MolyMines said: “This offtake agreement cements a close alliance with TKMetand the ThyssenKrupp Group, one of the world’s largest steel andtechnology groups, and sends a powerful message to the internationalfinancial community.
“It is also a keystone to the project financing as investors willtake note that we have successfully preserved shareholder value byensuring our sales agreement provides maximum exposure to molybdenumprice. We have resisted the temptation of floor priced contracts withprice participation mechanisms that transfer value away fromshareholders.”
Under the terms of the agreement, TKMet will take delivery andpurchase of 100p.c. of Moly Metals Australia’s interest (currently100p.c.) in molybdenumproduct from Spinifex Ridge, either as oxide or ferro-moly, after ithas been toll-processed under the company’s tolling agreement with itsstrategic alliance partner Molymet, the Chilean metallurgical group.
Moly Mines says that pricing will be determined with reference to theprevailing market prices and conditions at the time of sale. Thismaintains the company’s full exposure to the molybdenum price, it adds.
MOLY MINES 2
Moly concentrates produced at Spinifex Ridge will be shipped toMolymet’s plant in Santiago, Chile for conversion to moly oxide and/orferro-moly under the tolling agreement signed last December.
ThyssenKrupp AG is one of the largest industrial groups and steelproducers in Europe with combined annual turnover of more than €50bn in2007 across its business units. It has over 190,000 employeesworld-wide in 2,500 locations in 70 countries. The Group is amongst thelargest producers of high-quality and stainless flat steel products andhas major expansion programmes underway in Brazil and the US.
Moly Metals Australia Pty Ltd is a wholly-owned subsidiary of MolyMines Ltd and the 100p.c. owner of Spinifex Ridge. The project is ontrack for construction completion and commissioning in the second halfof 2009.
Spinifex Ridge is located in the East Pilbara District of WesternAustralia, approximately 50km north-east of Marble Bar. The depositcontains a resource of over 1bn tonnes which Moly Mines plans to exploitby a conventional open pit shovel and truck operation, with the oretreated on site for the production of separate moly and copper concentrates.