Business
Re Joint Venture
Re Joint Venture.
About this update from Petra Diamonds Limited
[{"type":"text","content":"\n Petra Diamonds Ld\n01 August 2007\n\n\n Petra Diamonds Limited\n\n Petra Diamonds Signs Luangue Joint Venture Agreement\n\nPetra Diamonds Limited ('Petra') announces that it has entered into a joint\nventure agreement ('Luangue JVA') with BHP Billiton to develop the Luangue\ndiamond project ('Project Luangue') in north eastern Angola.\n\nHighlights\n\n • On 28 February 2007 Petra acquired the entire issued share capital of\n Frannor Investments and Finance Limited ('Frannor') from Xceldiam Limited \n ('Xceldiam')\n\n • Frannor holds interests in Project Luangue, the diamond project that\n borders the northern boundary of Project Alto Cuilo (which is subject to a\n separate joint venture agreement between Petra and BHP Billiton) in the\n diamond belt of north eastern Angola\n\n • Under the terms of the Luangue JVA:\n\n (i) BHP Billiton has acquired 25% of the issued share capital of\n Frannor from Petra for a cash consideration of US$22.35 million; \n and\n\n (ii) BHP Billiton's shareholding in Frannor will remain at 25% until\n BHP Billiton's earn-in date ('BHP Billiton Earn-in Date'), defined \n as the earlier of (i) the formation of a kimberlite mining company \n or (ii) 180 days following the submission of a Technical and \n Economic Viability Study ('EVTE') in accordance with the Luangue \n kimberlite concession contract, provided that in either case a BHP \n Billiton pre-feasibility study is completed beforehand. Submission \n of an EVTE to the relevant authorities in Angola provides a basis \n for the formation of a mining company. At the BHP Billiton Earn-in \n Date, BHP Billiton's shareholding in Frannor will increase to 75%, \n with Petra holding the remaining 25% of Frannor; and\n\n (iii) BHP Billiton will sole fund the development of Project Luangue up\n to the BHP Billiton Earn-in Date. Should a minimum expenditure \n commitment, defined as three times Petra's net investment cost, \n not have been reached at the BHP Billiton Earn-in Date, BHP \n Billiton will continue to sole fund until it is achieved. When \n this BHP Billiton sole funding threshold has been reached, BHP\n Billiton and Petra will fund the development of the Project \n Luangue pro rata to their 75% / 25% respective shareholdings in \n Frannor (with commensurate dilution if either defaults in \n funding). BHP Billiton will provide debt financ...