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Fleurette And Glencore Complete Merger Of Mutanda And Kansuki Mining Operations

LONDON, July 25, 2013 /PRNewswire/ --

Fleurette Group (Fleurette) and Glencore ("the Partners") have today completed the merger of the Mutanda and Kansuki copper-cobalt projects in the Katanga Province of the Democratic Republic of the Congo (DRC).

Following the merger, Glencore has a 54.5% indirect interest in the enlarged operations, and will continue to have overall management and operational control of the projects. The remaining interests are held 31% by Fleurette through its wholly owned subsidiary, Rowny Assets Limited, and indirectly held 14.5% by High Grade Minerals S.A. (HGM).  As part of the agreement, Glencore has the right to acquire, and Rowny has the right to sell 50% of Rowny's share in July 2016 and the remainder in July 2018 at fair market value.

Mutanda is a developed high grade copper and cobalt producer which in 2012 produced 87,000 and 8,500 tonnes of copper and cobalt respectively. The Kansuki concession is a 185 square kilometre copper and cobalt pre-development project bordering the Mutanda concession. To date the Partners have already invested $570 million out of a total commitment of $670 million of capital expenditure for the mine and plant development. Fleurette's share of the capital already invested is $200 million.

Since Mutanda began producing copper in 2007 it has produced 183,000 tons of copper contributing millions in taxes and royalties to the DRC. The current operation employs 2,300 people of which 96% are DRC nationals and this is expected to rise post merger as investment in the operations continues.

The merger of Mutanda and Kansuki consolidates Fleurette's stake in an important copper cobalt operation with significant scope for expansion. The current combined mining operations at Mutanda/Kansuki are expected to have annualized production capacity of 200,000 tonnes per annum of copper cathodes and 23,000 tonnes per annum of cobalt hydroxide by end of 2013, with further growth potential in the future. Further synergies are expected to be available to the joint operations, including shared management, power, tailings, infrastructure and the joint mining of the shared high grade ore body.

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