Crew gains South African mine, smelter

Following an international tender, Vancouver-based Crew Development (CRU-T) has acquired a copper mine and smelter complex in South Africa’s North Western Cape province.

Crew’s 50%-owned, Johannesburg-based subsidiary, Metorex, has acquired an 81.47% interest in the O’okiep Copper Company for R28.18 million (about $7.2 million) in cash.

O’okiep’s Nigramoep copper mine has 700 employees and produces about 20,000 tons of copper annually. The associated smelter has a capacity of 35,000 tons annually, with the 15,000-ton difference made up through toll smelting.

Current reserves at Nigramoep will support a 3- or 4-year mine life, though this figure could potentially be extended with a successful exploration program on the company’s 1,000 sq. km. of mineral rights.

The principal condition allowing the deal to close is the receipt by O’okiep of R82.5 million in cash payable by Anglo American for O’okiep’s 27.5% interest in Gamsberg Zinc Corp. Following this receipt, and the funding of the projected rehabilitation and retrenchment liabilities at the end of the mine life, O’okiep will be in a positive cash position, Crew says.

Under the terms of the acquisition agreement, Metorex will make an offer to the minority shareholders of O’okiep which, if taken up in full, will require the cash outlay of a further R6.4 million, boosting to 100% Metorex’s stake in O’okiep.

O’okiep remains profitable at current copper prices and is expected to make a significant contribution to Metorex’s cash flow next year.

The acquisition of O’okiep increases the copper component of the Metorex group to about 30% in relation to its existing zinc, gold, coal and antimony interests.