Yankuang gains access to bauxite resources with final debt payment
Shanghai. June 15. INTERFAX-CHINA - Yankuang Group Corp. Ltd. (Yankuang) has paid the final installment of an AUD 12.9 million ($13.59 million) debt owed to Australian Securities Exchange-listed Bauxite Resources Ltd. (BRL) as part of a joint venture (JV) agreement signed in January of this year, BRL announced June 14.
Under the terms of the agreement, Yankuang agreed to pay the Australian company AUD 6.1 million ($6.42 million) as reimbursement for exploration work previously carried out on Western Australia's Darling Range, the announcement said. BRL would also recoup 70 percent of its past expenditure on direct shipping ore (DSO) proposals from Yankuang, totaling AUD 6.8 million ($7.17 million).
Two JVs, collectively known as the Bauxite Alumina Joint Ventures (BAJV), officially began operations on April 1, 2011, according to the announcement. They will mine for bauxite and construct a refinery on the Darling Range. The refinery has a designed annual production capacity of 1.1 million tons for alumina, and 3.5 million tons for bauxite.
Yankuang will cover 91 percent of the refinery's construction costs in return for a 70 percent share of all alumina resources found, the announcement added. BRL will pay the remaining 9 percent of costs, aided by borrowed funds from Yankuang. State-owned Yankuang, meanwhile, has agreed to offtake 50 percent of BRL's share of alumina for the first 10 years of refinery operation in order to secure repayment from BRL.
Based in the city of Jining, Shandong Province, Yankuang is involved in coal mining, as well as the aluminum, chemical coal and power manufacturing industries.
The Darling Range produces 23 percent of the world's alumina, according to BRL. The company owns an area there covering 24 square kilometers.
-HD