Wednesday, October 20, 2010

Marengo inks financing deal with China



MARENGO Mining (MGO), the operator of the Yandera gold, copper and molybdenum project in Madang, has signed a landmark financing and off-take deal with a Chinese construction and engineering group for its 100% owned Yandera project, The National reports.

In a statement released yesterday, MGO said the memorandum of understanding (MOU) with China’s Nonferrous Metal Industry’s Foreign Engineering and Construction (NFC) was facilitated by Perth-based Arccon WA Pty Ltd (Arccon).

Under the MOU, Marengo has agreed to work exclusively with NFC and Arccon to establish the cost and programme for delivery of the Yandera project in parallel with the completion of the current definitive feasibility study (DFS).

Marengo’s managing director Les Emery said: “This potentially paves the way for formal agreements which will underpin the development of one of the world’s significant new copper projects.”

“While the foundation of the MOU is the construction and engineering contract for the Yandera project, it is important to note that the deal also contemplates NFC facilitating project finance and concentrate off-take for the project, together with potentially investing either in Marengo or the project, or both,” he said.

NFC president Wang Hongqian added: “NFC looks forward to a close and co-operative relationship with Marengo Mining as we work together to lay the foundations for one of the world’s biggest new copper mines in PNG.”

They said the discussions would be conducted to enter into a formal construction agreement (engineering, procurement and construction or EPC contract).

Here, Marengo will appoint NFC as the principal contractor, under a lump-sum turnkey contract, following a detailed evaluation of the project construction costs to be undertaken by NFC as part of the final stage of the DFS.



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