Canyon resources enforces SPA, MOU with MCC

The Australian Securities Exchange-listed mining company, Canyon Resources Limited has declared the enforcement of a Strategic Partnership Agreement and MOU for the Minim Martap Bauxite Project in Cameroon with Zhongye Changtian International Engineering Corporation of MCC (MCC-CIE), the mining engineering division of global mining giant Metallurgical Corporation of China (MCC).

The agreement undertakes the awarding of the bankable feasibility study (BFS) contract for the development of Stage 1 of the Project to MCC-CIE in December 2020.

MCC-CIE is part of MCC, a 100% owned subsidiary of China’s Minmetals Corporation. MCC-CIE is one of China’s leading engineering, procurement and construction companies and works extensively with foremost banks in China.

MCC-CIE has been the principal contractor for Canyon on the BFS for the Project since December 2020.

The Strategic Partnership Agreement and MOU reflected: “In accordance with good cooperation between the parties during the BFS, Canyon and MCC-CIE shall commence a Comprehensive Strategic Partnership.”

“MCC-CIE, as the Strategic Partner, would offer necessary assistance to Canyon in facilitating the off-taking and financing for the project in China. MCC will also provide all necessary support to assist Canyon in technical, business offtaking and financial related issues, etc.”

In the present week, MCC has deployed a senior representative from MCC International to Cameroon, which is a clear indication of MCC’s commitment to endorsing the Project in Cameroon, and its immediate support for Canyon under the Strategic Partnership Agreement.

However, in conjunction with Canyon’s executive management, including the Managing Director, a number of introductory meetings have been held in Douala with senior government officials to present the merits of the Strategic Partnership to the Government of Cameroon. Meetings commenced yesterday and already the feedback has been very positive, and the authorities have been impressed with the immediate attention shown by MCC.

Phillip Gallagher, Managing Director, Canyon Resources, said: “Canyon has worked with MCC-CIE since late 2020 on the BFS for the Minim Martap Project and the signing of this Strategic Partnership and MOU is a very positive next step. Executing the MOU with MCC-CIE is a testament to the sound relationship Canyon and MCC-CIE have established in a relatively short space of time, and MCC-CIE will introduce real options for project financing and off-take. It is a great benefit to Canyon to have a Strategic Partner with extensive experience in building and operating mining projects in Africa.”

“MCC-CIE is part of the MCC and Minmetals group of companies that own and operate mines across various commodities, alumina refineries and aluminium smelters. They know the Minim Martap Project very well due to their ongoing involvement with the BFS. It is exciting to have a technical and financial partner of the scale and calibre of MCC-CIE offering to substantially increase its involvement in the Project, thereby confirming MCC-CIE’s endorsement of the Minim Martap Project and Cameroon as a whole.”

The key details of the MOU and Strategic Partnership Agreement are as follows:

• The parties have commenced a Comprehensive Strategic Partnership and will immediately hold regular meetings to promote the financing and execution of the Project.
• MCC-CIE will provide Canyon with all necessary support within its capacity to assist Canyon in technical, business, off-taking and financing related issues.
• The relationship which is created Strategic Partnership Agreement and MOU is until 31 December 2022 unless extended.
• The parties agree to reach a more comprehensive legally binding agreement for the implementation of the project to replace the non-binding relationship established through the MOU and Strategic Partnership Agreement.