First long term off-take LOI signed for Tamboli: WMN
Tuesday, April 28 2015 - 01:00 AM WIB
ASX-listed Western Mining Network Ltd (WMN) said that it has received a Letter of Intent (LOI) from Dongsong Hichem Co Ltd for the purchase of up to 50,000 tons per annum of graphite powder from the company?s planned processing and purification plant at the Tamboli project in Kolaka, Southeast Sulawesi.
?The LOI was received after an analysis of the Tamboli graphite ore was conducted by the Korean Testing &Research Institute as part of the due diligence process undertaken by Dongsung which also completed a review of the company?s mining and beneficiation plant. The final agreement with respect to monthly volumes and pricing formula is anticipated to be completed in the coming months,? WMN said in a statement Tuesday.
The receipt of this LOI follows the execution of definitive agreements in February with a Korean Consortium to develop the Tamboli plant. The Korean Consortium comprises Udin Engineering Co. Ltd, E-Petro Chemical Co. Ltd, and Nexinova Corporation Ltd. Under the definitive agreement, WMN will be responsible for mining and stockpiling graphite ore, Udin will be responsible for engineering, procurement and construction of a beneficiation plant for Tamboli and E-Petro will be responsible for ensuring that the plant output will be a suitable graphite carbon powder that can be marketed by Nexinova to its proprietary steel industry customers throughout Asia.
?This LOI is another important step in developing Tamboli and provides further validation there is a strong market for the product which could be supplied from the project,? said WMN Executive Chairman Christopher Clover.
?Due to Tamboli?s location and excellent infrastructure there has been substantial interest from several parties. With our project partners now in place, the company is looking forward to finalizing the remaining steps which include financing in order to bring Tamboli on line,? he added.
Elsewhere, WMN said In order to continue to fund the company?s working capital requirements as it continues to execute its business plan for Tamboli, the company, recently completed a small placement of 812,500 shares at an issue price of $0.40 to raise approximately $325,000. The placement includes 406,250 options exercisable at $0.50 expiring June 30, 2016 and 406,250 options exercisable at $0.60 expiring June 30, 2017.
The placement was made directly to overseas investors and there were no costs or commissions in relation to the placement.
Editing by Reiner Simanjuntak