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African Copper hopes to re-start mining

Completed concrete
work on the primary
jaw crusher complex
at African Copper’s
Mowana project in
London, England — MININGREVIEW.COM — 27 May 2009 – African Copper plc – the London-based international mineral and exploration company – believes it has satisfied virtually all the claims made against it by mining investment firm Natasa Mining Limited, and is looking to restart mining, sending its shares up 22%.

In a statement released here, the AIM-listed miner said it had repaid R245 million (153 million Botswana Pula) to Natasa from the bonds issued by its Messina unit and had paid the investment firm a further R24 million (15 million Pula) in settlement for some of Messina’s debts. It had also repaid Natasa US$1.5 million (R14 million) for a bridge loan.

The company put its first copper mine, Mowana, on care and maintenance in January, pending completion of financing talks. It rejected a takeover offer from Natasa, leaving the way open for rival bidder Zambia Copper Investments Limited (ZCI).

ZCI agreed a US$22.5 million (R203 million) financing package for African Copper, and then provided the miner with an additional US$25.4 million (R230 million) after Natasa had demanded immediate repayment of the Messina bonds earlier this month.

“Natasa seems to have a hold on the situation and has made some cash on this after being edged out of the picture somewhat by ZCI,” said Ambrian mining analyst Julian Emery. “Copper prices are also coming good now, but African Copper’s shares are up on the bond payment, which is good news for the company.”

The remaining proceeds from the ZCI financing package will be used to repay small creditors as debts become due, the African Copper statement added.

"African Copper and ZCI look forward to the completion of all outstanding matters, so that mining operations can recommence, and cash can start to flow in following production and sale,” the statement concluded.