Project risks16 Apr 2023 16:08
In stark contrast to my last post, let me offer a much less optimistic view/possible outcome here.
Some of the scenarios and share price predictions discussed on here in the last few weeks are really fanciful IMO.
We need to be aware of the real risk of losing our mining licence when / if Zioc runs out of money / can’t repay its loan and control of MPD is ‘handed over’ to the government and a new developer/miner.
Marketing Agreement
MPD and ZIOC have entered into a life-of-mine marketing agreement with Glencore International which will take effect immediately prior to Completion, pursuant to which MPD has granted Glencore International the exclusive marketing right for all iron ore produced from the Zanaga iron ore mine located in the Republic of Congo that is being developed and shall be owned and operated by MPD or one of its Affiliates and ANY OTHER PRODUCTION of iron ore from assets belonging to MPD, ZIOC or their respective Affiliates in the Republic of Congo using similar infrastructure, subject to the terms and conditions of the Marketing Agreement and in the case of any PROJECTS ACQUIRED, subject to pre-existing marketing rights.
It’s all in the detail…The ‘new MPD’, cluster of mines in the region, being Zanaga, Mayoko 1 (Sapro), Mayoko 2 (ex Midus). I can see the Obambi family - very close to Nguesso & Co.- heading this.
Glencore won’t lose out. The ‘life of mine(s)’ marketing rights for all the ore produced by the -enlarged- MPD is surely more valuable to them than their shareholding in Zioc.
If Glencore starts offloading their shares in the Summer, as they are allowed to do, then we really need to worry.
I hope I wrong of course but it’s Africa and we’re on AIM..
GLA. Victor Meldrew
(Tin hat on !!)
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