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Kazakhmys PLC (KAZ)

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Monday 13 June, 2011

Kazakhmys PLC

Kazakhmys Announces MOU Towards Aktogay

RNS Number : 3040I
Kazakhmys PLC
13 June 2011



13 June 2011






Kazakhmys PLC ("Kazakhmys") announces that it has today signed a memorandum of understanding ("MOU") with the China Development Bank Corporation ("CDB") to secure a $1.5 billion loan facility, to develop the 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.  This loan will be in addition to the existing CDB loan facility of $2.7 billion, which is being used for the development of the major copper project at Bozshakol and a series of mid-sized projects.


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% of our current production, which is significant for Kazakhmys and for the growth of the metals industry in Kazakhstan."


For further information please contact:


Kazakhmys PLC

John Smelt

Head of Corporate Communications

Tel: +44 20 7901 7882

Tel: +44 78 7964 2675

Irene Burton

Financial Analyst

Tel: +44 20 7901 7814

Maksut Zhapabayev

Head of Corporate Communications


    Tel: +77 27 3304  556

Zulfira Mukhamedyarovа

Senior Manager - Media Relations

Tel: +77 27  3304  556 


David Simonson

Tel: +44 20 7726 8400

Ian Middleton

Tel: +44 20 7726 8400

Fiona Crosswell

Tel: +44 20 7726 8400



6th Floor, Cardinal Place, 100 Victoria Street, London SW1E 5JL.


Notes to Editors

Kazakhmys PLC is a leading international natural resources group with significant interests in copper, gold, zinc, silver, power generation and petroleum.


It is the largest copper producer in Kazakhstan and one of the top worldwide with 17 operating mines, 10 concentrators and 2 copper smelters. Kazakhmys Copper operations are fully integrated from mining ore through to the production of finished copper cathode and rod. Total copper cathode equivalent produced in 2010 from own ore was 303 thousand tonnes. Production is backed by a captive power supply and significant rail infrastructure.


Kazakhmys Copper 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 in the top ten largest silver producers in the world (14 million ounces produced in 2010).


Kazakhmys Power has a 50% interest in the coal fired Ekibastuz GRES-1 plant, the largest in Kazakhstan with a nameplate capacity of 4,000 MW.


The Group is part of the FTSE-100 index of companies listed on the London Stock Exchange and is also listed on the Kazakhstan Stock Exchange (KASE). It had revenues of $3.2 billion in 2010 with Group EBITDA (excluding special items) of $2.8 billion. The Group employs some 61,000 people, principally in Kazakhstan. The Group's strategic aim is to optimise its current operations, deliver its major growth projects and to diversify and participate in the development of the significant natural resource opportunities in Central Asia.



Existing $2.7bn CDB Loan

In 2009, CDB signed agreements with Joint Stock Company "Sovereign Wealth Fund "Samruk-Kazyna" ("Samruk") in which it agreed to lend $3.0 billion to Samruk. Samruk signed agreements with Kazakhmys in which it committed to on-lend $2.7 billion of those funds to Kazakhmys Finance PLC.  The funds are available for drawing anytime within a 3 year period, and once drawn incur interest at USD LIBOR plus 4.8%. Each facility has a final maturity of between 12 and 15 years from the date of first drawing with amortisation commencing three years following the date of the first drawdown.   The funds are earmarked for the major copper project at Bozshakol and a series of mid-sized projects.



2011 Memorandum of Understanding

The 2011 MOU between Kazakhmys and CDB allows for a further loan of $1.5 billion, to be used for the development of the major copper project at Aktogay. The final terms of the loan are to be negotiated but the loan is likely to have similar maturity and interest rates to the existing $2.7 billion facility.

This information is provided by RNS
The company news service from the London Stock Exchange