Wallbridge Mining Co Ltd - News Release
Wallbridge Mining forms JV with Lonmin
Wallbridge Mining Co Ltd WM
Shares issued 25,235,941 Jan 14 2002 close $.700
Tuesday Jan 15 2002 News Release
Mr. Wayne Whymark reports
WALLBRIDGE MINING COMPANY AND LONMIN PLC FORM JOINT VENTURE ...
Wallbridge Mining Company Limited has entered into a joint venture agreement with Lonmin PLC for the exploration of Wallbridge's principal properties in the Sudbury basin of Ontario.
Lonmin is the world's third-largest underground primary producer of PGMs (platinum group metals) and has significant mining, metallurgical and refining experience from its operations on the South African Bushveld igneous complex.
Under the terms of the agreement, Lonmin is committed to finance a minimum of $4.5-million (U.S.) toward exploration activities over the next two years. This agreement advances Wallbridge's exploration programs as the company begins its fifth year of operations in Sudbury.
"This transaction takes Wallbridge to the next level in our corporate development. It will finance our Sudbury exploration and any discovery right through to production," said Wayne Whymark, president of Wallbridge. "Lonmin is the recognized lowest-cost producer in the industry and has the ability to fund both exploration and mine development in Canada."
"We are impressed by Wallbridge. They have good property positions in the Sudbury basin and the exploration expertise we look for," said Ian Farmer, director of corporate development and marketing at Lonmin. "This agreement provides us with an opportunity to gain a meaningful position in one of the world's great mining areas."
The joint venture agreement covers 19 of Wallbridge's wholly owned properties in the Sudbury basin. The joint venture partners plan to spend $4.1-million (U.S.) on exploration in 2002. Of that, $1.5-million (U.S.) has been allocated to the Windy Lake property and $700,000 (U.S.) to the Ministic offset property. The $1.9-million (U.S.) balance will be spent on the remaining 17 properties.
In order to maintain its rights under the agreement, Lonmin must spend an additional minimum average of $2.0-million (U.S.) in exploration and/or feasibility study work per year over another two-year period. Lonmin may elect to extend these two-year periods at their option by spending additional $2.0-million (U.S.) minimum amounts. During the exploration phase, Wallbridge will be the operator of the joint venture. When an indicated resource (Canadian Institute of Mining and Metallurgy Code) is established on a joint venture property, Lonmin will vest a 50-per-cent interest in that property. At such time, Lonmin has the option to become the operator of that property and can increase its interest to 65 per cent by financing and delivering a full feasibility study.
If Lonmin elects to put a property into production, it shall provide or arrange 100 per cent of the initial development financing including all necessary third party guarantees. The operating cash flows from the mine will be divided 65 per cent Lonmin and 35 per cent Wallbridge.
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