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Gold/Mining/Energy : Mining News of Note -- Ignore unavailable to you. Want to Upgrade?

To: LoneClone who wrote (30491)	12/17/2008 10:27:07 PM
From: LoneClone	Respond to of 195027

Zhongjin to have no quick ore supply from Perilya individual.com Chinese lead and zinc producer Shenzhen Zhongjin Lingnan Nonfemet Co., Ltd. (SZSE: 000060) will not obtain an immediate ore supply through the acquisition of Australia's Perilya Limited. The Australian miner, however, has already signed outsourcing agreements with other companies. Southwest Securities Analyst Lan Ke said that the agreements accounted for not less than 50 percent of Perilya's total capacity, so not until 2012 can the majority of its zinc mines supply Zhongjin Lingnan. Zhongjin Lingnan announced on December 9, 2008 that through a special purpose vehicle (SPV) in Hong Kong, it would subscribe 197.672 million common shares placed by Perilya, at AUD 0.23 apiece. The Shenzhen-listed company said it would obtain a 50.1 percent stake in Perilya after the deal worth AUD 45.4646 million was closed. On December 11, 2008, Perilya shares closed at AUD 0.16 per share, marking a slump from AUD 5.50 apiece in early 2007. Moreover, the operating profit margin of the Australian miner plunged 108.8 percent year on year in the first half of 2008, and its net profit margin surged 52.08 percent in 2007 from a year earlier. Zhongjin Lingnan, a state-controlled company specializing in mining and processing of nonferrous metals, has been expanding its smelting capacity since 2006. In 2009, when its new smeltery is put into operation in Shaoguan, a city in the southern Chinese province of Guangdong, its zinc and lead smelting capacity will jump to 400,000 tons a year. However, at that time, the Shenzhen-listed company can only supply less than 50 percent of its total ore concentrate demand on its own. That is why the company has strived to add upstream reserves and cast its eye to Perilya, whose major products contain lead and zinc concentrate. The Australian miner owns several mines: a zinc, lead, and silver mine located at Broken Hill of New South Wales, a high-tenor silicate containing zinc oxidation mine situated at Flinders of South Australia, a high-tenor zinc oxide mine lying at Beltana, and a copper and cobalt mine in Queensland. These mines have approximately 2.22 million tons of zinc, 1.41 million tons of lead, and 200,000 tons of copper, and they are also estimated to possess 190 kilograms of silver and 775 kilograms of cobalt. Notably, the Australian largely narrowed its production capacity in the first half of 2008. The ore exploited from the mine at Broken Hill fell to 950,000 tons from 1.8 million tons of last year, and the exploitation will not expand in the following two to three years. (USD 1 = CNY 6.84, USD 1 = AUD 1.25)