Yunnan Copper Industry (Group) Co. Ltd (YCI) and China Yunnan Copper Australia Limited (CYU) will jointly explore and develop copper deposits in Yunnan Province, China
Key components of the Alliance are:
- Resource Evaluation Joint Ventures - YCI will propose several potential JV projects for CYU's review. Each project will have separate programmes and mutually agreed budgets.
- If a project is reviewed and indicates development potential, a mining joint venture will be formed.
- Geological and legal consultants based in Kunming, China are to be engaged by CYU to complete due diligence on projects offered to date.
CYU and its cornerstone investor YCI announced today the formation of a major strategic alliance to conduct exploration activities in Yunnan Province, China. YCI's largest shareholder is Chinalco (49%).
YCI, which is China's third largest copper producer owns and operates six copper mines and three developmental projects in Yunnan and Sichuan provinces, has many advanced prospects beyond the scope of their near mine exploration teams, which require further drilling and evaluation.
Jason Beckton, Managing Director of CYU, said:
This China Copper Alliance represents a unique opportunity to operate in one of the most prospective copper-gold belts in the world with a dominant partner who can provide production and importantly permitting expertise. We have to date been offered three projects which are in a process of review which is expected to be completed in early 2010.
CYU has a previously stated goal of acquiring near term cash flow projects. CYU has the expertise to bring projects to JORC compliance status and in partnership with YCI, in its operational backyard, can facilitate rapid commissioning of any promising projects.
CYU will have a partner in China with a competitive edge as we work through large, high quality, long life assets in a highly prospective region of the world.
Chao Yang, General Manager of YCI and formerly Co Chairman of CYU, said:
We are satisfied with the co-operation between YCI and CYU since becoming a cornerstone investor of CYU over two years ago. We are pleased to enter an alliance to explore opportunities with CYU in China. YCI is a large organization of over 20,000 employees but we do not have the resources and expertise to advance all of our projects.
We believe an alliance such as this will benefit both CYU and YCI shareholders. It is critical for YCI to expand its Chinese production base through the partnership with CYU to bring some exploration projects into production. CYU provides YCI with an experienced exploration and evaluation team to deploy on some of our projects near the production centres.
About YCI
www.yunnan-copper.com
YCI is China's third largest copper producer and produced 385,000 tonnes of copper cathodes in 2008 and 426,000 tonnes in 2007. YCI has copper resources and reserves of around 8 million tonnes metal in situ. On the 25th of January 2008, the Aluminum Corporation of China (Chinalco) acquired a 49% interest in YCI. Chinalco has confirmed its strategic alliance with YCI and reiterated their ongoing support for China Yunnan Copper Australia to become YCI's international investment arm and mining house.
Figure 1. Map depicting location in southern China of Yunnan Province, prospective for porphyry and volcanic massive sulphide copper deposits.
Figure 2. Map location of existing YCI operations. The China Copper Alliance will allow access for CYU to advance new projects in this sphere of operations.