LONDON--(BUSINESS WIRE)--
2 September 2014
China Nonferrous Gold Limited
(“CNG” or the “Company”)
Award of Consultancy Contracts
China Nonferrous Gold Limited (AIM: CNG), the mineral exploration and development company currently developing the Pakrut gold project (the “Project”) in the Republic of Tajikistan (“Tajikistan”) is pleased to announce that it has awarded China No.15 Metallurgical Construction Group Co., Ltd (“15MCC”) two consultancy contracts (the “Consultancy Contracts”). The first contract relates to the construction of a processing plant, smelting plant and ancillary facilities (the “Processing Plant and Smelting Plant Contract”). The second contract relates to the construction of tailing ponds and certain ancillary facilities (the “Tailing Ponds Contract”).
Under the Consultancy Contracts, 15MCC will provide consultancy services to CNG in connection with the construction of the processing plant, smelting plant, tailing ponds and certain ancillary facilities. 15MCC was awarded the Consultancy Contracts following a competitive tender process undertaken by the Company with multiple proposals.
Terms of the Consultancy Contracts
Pursuant to the Processing Plant and Smelting Plant Contract, the consultancy service fee is c.RMB36.5 million (US$5.9 million) and the target construction cost is estimated to be c.RMB206.7 million (US$33.7 million). Pursuant to the Tailing Ponds Contract, the consultancy service fee is c.RMB13 million (US$2.1 million) and the target construction cost is estimated to be c.RMB76.9 million (US$12.5 million).
Pursuant to the terms of an agency agreement entered into on 24 May 2012, as amended on 17 June 2014, between LLC Pakrut, Kryso Resources Limited, the Company and China Nonferrous Metals Int’l Mining Co., Ltd (“CNMIM”), the Company’s largest shareholder with approximately 38.44% of the issued share capital, CNMIM was appointed as the Company’s agent for the purposes of entering into certain agreements in connection with the development of the Project. Accordingly, following approval by the Company, CNMIM entered into the Consultancy Contracts as agent for the Company.
Related Party Transaction
15MCC is an associate of CNMIM and, as a result, pursuant to AIM Rule 13, the entry into each of the Processing Plant and Smelting Plant Contract and the Tailing Ponds Contract is deemed to be a related party transaction. The independent directors of the Company, namely Abuali Ismatov, Leonard Lee (Li Li), Wang Yubin and Che Pizhao consider, having consulted with the Company’s Nominated Adviser, Investec Bank plc, that the terms of the transactions are fair and reasonable insofar as shareholders are concerned.
For further information please visit the Company’s website (www.cnfgold.com) or contact:
China Nonferrous Gold Limited
David Tang, Managing Director
Tel: +86 10 8442 6681
Investec Bank Plc
Jeremy Ellis, George Price
Tel: +44 (0)20 7597 5970
Hume Capital
Jon Belliss, Guy Peters
Tel: +44 (0)20 3693 1470
Project Summary
The Pakrut gold project, of which CNG has 100 per cent ownership, is situated in Tajikistan approximately 120km northeast of the capital city Dushanbe. Pakrut is located within the Tien Shan gold belt, which extends from Uzbekistan into Tajikistan, Kyrgyzstan and Western China, and which hosts a number of multi-million ounce gold deposits.
CNG is currently in a construction phase with mining contractors on site developing the underground mine and surface infrastructure.
About Tajikistan
Tajikistan is a secular republic located in Central Asia. The country is a member of the Commonwealth of Independent States and the Shanghai Cooperation Organisation. Tajikistan hosts numerous operating precious metal mines as well as the largest aluminium smelter in Central Asia. CNG's management team has extensive experience in the mining industry in Tajikistan.