A Malaysian tin smelting company will finance the reopening of Adex Mining’s (TSE) Mount Pleasant polymetallic mine in New Brunswick in exchange for a 51% stake in that company.
Malaysian Smelting can subscribe for up to 121.7 million shares of Adex at 23 cents per share, for a total investment of $28 million.
Mount Pleasant, according to Adex, is North America’s largest tin deposit and contains the world’s largest reserve of indium.
The mine would serve as a source of tin concentrate for Malaysian Smelting.
Adex plans to use $2 million of the financing to complete a feasibility study, by October, on Mount Pleasant.
If the study is positive, Adex will use the balance of the proceeds to bring the mine into production. An additional $14 million will be provided by provincial grants and loans, Adex says.
The North zone of the Mount Pleasant deposit contains proven and probable reserves of 7.1 million tonnes grading 0.62% tin and 0.65% zinc, plus 91 grams indium per tonne. The Fire Tower zone has proven reserves of 9 million tonnes grading 0.03% tin, 0.08% zinc and 31 grams indium. Should a production decision be made, tin would provide about 55% of the mine’s cash flow. The mine is projected to produce 2,000 tonnes per day.
The agreement with Malaysian Smelting, whose principal shareholders are Malaysia Mining and Straits Trading Co., has yet to be approved by Adex shareholders.
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