Nautilus Minerals Inc. (TSX: T.NUS, Stock Forum) said it has signed a deal that will make Tongling Nonferrous Metals Group Co. Ltd. of China the first customer for sulphides produced from its sea-bed mine near Papua New Guinea.
The agreement provides for the purchase by Tongling of 1.1 million tonnes per annum of material for a period of three years on a take or pay basis. The initial delivery date from the Solwara 1 deposit is targeted for the fourth quarter of 2013.
“The quality of this relationship with China's largest importer of copper concentrates provides further evidence that there is considerable interest in the high grade massive sulphides being found by the emerging seafloor resource production industry," said Nautilus CEO Stephen Rogers.
The material will be imported into China by Tongling and then processed through its facilities in the city of Tongling alongside the Yangtze River. After production of a copper concentrate it will be smelted in Tongling's industrial complex. The purchase price to be paid by Tongling will be based on the quality of the copper concentrate produced.
Trading at $2.38 on Tuesday, Nautilus has a market cap of $467.2 million, based on 196.3 million shares outstanding. The 52-week range for the stock is $3.40 and $1.80.