Business
Update - Koffiefontein Mine
Update - Koffiefontein Mine.
About this update from Petra Diamonds Limited
[{"type":"text","content":"\n Petra Diamonds Ld\n18 December 2006\n\nFor release 18 December 2006\n\n\n\n Petra Diamonds Limited\n\n Update - Koffiefontein mine\n\nPetra Diamonds Limited ('Petra' or 'the Company'), the AIM-quoted and ASX-listed\ndiamond group, announces that it and its wholly owned subsidiary, Blue Diamond\nMines (Pty) Limited ('BDM'), have entered into a conditional agreement ('the\nAgreement') with De Beers Consolidated Mines Limited ('De Beers') to acquire the\nmining and associated capital assets ('Assets') previously used by De Beers in\nthe operation of the Koffiefontein diamond mine ('Koffiefontein') situated in\nthe Free State province of South Africa.\n\n\nBDM has also applied to the South African Department of Minerals and Energy ('\nDME') for a mining right in respect of Koffiefontein; De Beers ceased mining at\nKoffiefontein when its old order mining right expired in February 2006. In\naccordance with South African mining legislation, BDM is not permitted to\ncommence mining until the new mining right is issued; Petra expects this to be\nissued shortly and BDM will then use the assets acquired from De Beers to\noperate Koffiefontein.\n\n\nThe consideration for the Assets is R81.9 million (£5.98 million); this\nconsideration is to be settled by BDM assuming De Beers' rehabilitation\nobligations at Koffiefontein, which amount to R80 million (£5.84 million), plus\nthe payment in cash by BDM to De Beers of R1.9 million (£138,700). There is no\nfurther consideration with regards to the Assets.\n\n\nCompletion of the Agreement is conditional upon the following key conditions:\n\n(i) the DME issuing to BDM a new mining right in respect of\n Koffiefontein; and\n\n(ii) the DME issuing a closure certificate to De Beers in\n respect of Koffiefontein; and\n\n(iii) the DME consenting to the cession, transfer and delegation\n of the rehabilitation obligations and liabilities in respect of \n Koffiefontein from De Beers to BDM; and\n\n(iv) the return to De Beers by the DME of all amounts and\n financial guarantees previously deposited by De Beers with the DME as \n part of De Beers rehabilitation obligations in respect of \n Koffiefontein; and\n\n(v) approval by the South African Competition Commission.\n\n\n\nWhen the conditions above have all been met, which is expected to be in early\n2007, Petra will commence production from Koffiefon...