EMED Mining (LON:EMED) climbed 14.88% today on news that the company has reached a $30 million funding arrangement with a new Chinese offtake partner respecting its Rio Tinto copper mine in Spain.
The European copper-gold miner, with projects in Cyprus, Slovakia and Spain, said that EMED and one of its subsidiaries will receive $30 million in shares and debt financing from Yanggu Xiangguang Copper Co. (XGC), in exchange for XGC taking a 10% equity stake in the company.
Under the deal, XGC will buy $15 million in EMED shares at 9 pence per share, and will arrange a $15 million debt facility. Along with a 10% stake, XGC also secured an offtake agreement for 25% of the mine's copper reserves at market prices.
EMED says it is currently in talks with potential project financers for finalizing a mandate for $175 million in debt financing.
The agreement with XGC awaits shareholder approval.
Toronto and London-listed EMED Mining said last June it found significant potential new copper deposits near its Cerro Colorado open pit operations in Spain.
A month earlier the Cyprus-based company announced Andalucia, one of Spain’s autonomous regions, gave approval for the plans to restart its flagship Rio Tinto copper mine, which was placed on care and maintenance in 2000. Production is scheduled to start in 2013 following further approvals.
The mine would produce 37,000 tonnes of copper per annum from 9 million tonnes of ore.