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LONDON (Alliance News) - Amur Minerals Corp looks set to secure project financing and potential partners for its Kun Manie project in Russia from private and state-owned organisations in South Korea after the Russian government helped organise a meeting with interested investors.
Amur signed a non-binding deal in early March with Russia's Far East and Baikal Region Development Fund which was established by Russian President Vladmir Putin and Prime Minister Dmitry Medvedev to boost investment within the sparsely-populated but mineral-rich region in the Far East of the country.
Under that original deal, the fund agreed to progress discussions about providing financing to Amur to fund the cost of the required infrastructure for Kun Manie, primarily a 320 kilometre road from the Ulak rail terminal on the BAM railway to the project site and an extension to the planned furnace smelter sites for the treatment of sulphide concentrate.
However, the fund has also expressed interest in financing additional parts of the project, which has been in the making for over a decade, and talks are continuing about how the pair can best facilitate a formal transaction, Amur said on Thursday.
The fund also agreed to provide advisory services to Amur regarding investment into the project and has held a "high level meeting" with a number of Korean state agencies to discuss options and considerations for funding and participation of the Kun Manie project.
Amur said it presented the project to "Russian economic agencies" and Korean entities including the International Economic Cooperation Division of the Ministry of Strategy & Finance, the private equity team at Korea Investment Corp and the business team at Korea Exim Bank, it said.
"A key strength of the project is the Russian government's support of the project, as demonstrated by the fund's organising of the event. This is important to interested Korean investors," said Amur. "The newly developed project financing Korean contacts will be advanced as the company advances the definitive feasibility study."
"The economic strength neighbouring Korea provides another avenue of project development to us. Korean officials are looking to Russia as a source of metals and other materials for their highly industrialised economy and to develop additional service industry related activities such as engineering and construction projects," Robin Young added, Amur's chief executive.
"Opportunities for Korean companies to be involved in design-and-build contracts for portions of the Kun-Manie project, and of course potential metal off-take and streaming schemes are in the mix," he said.
In a separate statement on Thursday, Amur said it has issued 15.4 million new shares to Crede CG III Ltd after the investor elected to convert warrants it held under a subscription agreement signed back in December 2015. The shares were issued at a price of 0.0765 pence per share and leaves Crede with a 2.9% stake in the company following the transaction.
Amur shares were down 1.1% to 4.82 pence per share on Thursday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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