Copper producer Kazakhmys has announced the signing of a memorandum of understanding with the China Development Bank for a $1.5 billion loan.
The money will be used to develop the company’s major copper project at Aktogay in Kazakhstan.
Further negotiations will be undertaken to move the MOU to a full loan agreement by the end of 2011, the company said. The loan will be in addition to the existing CDB loan facility of $2.7 billion, which is currently being used for the development of Kazakhmys’s major copper project at Bozshakol, as well as a series of mid-sized projects.
Headquartered in London, UK, Kazakhmys is the largest copper producer in Kazakhstan and one of the top worldwide, with 17 operating mines, 10 concentrators and two copper smelters. The company also holds significant interests in gold, zinc, silver, power generation and petroleum.
Kazakhmys’s total copper cathode equivalent produced in 2010 from its own ore was 303,000 tonnes.
Oleg Novachuk, chief executive of Kazakhmys, said: “We are delighted to be developing our relationship further with CDB. This funding will allow us to develop Aktogay and yet retain full ownership of the asset.
“Our two major growth projects, Aktogay and Bozshakol, should produce around 200 kt of copper in concentrate each year, equivalent to 60 per cent of our current production, which is significant for Kazakhmys and for the growth of the metals industry in Kazakhstan.”
Kazakhmys produces significant volumes of other metals, including zinc, silver and gold. In 2010, it produced 167 thousand tonnes of zinc in concentrate. The group is one of the top 10 largest silver producers in the world, having produced 14 million ounces in 2010.
The company had revenues of $3.2 billion in 2010 and employs some 61,000 people, principally in Kazakhstan.
