News

July 15, 2008

Moydow Mines Cuts A Deal On Its Bauxite To Fund Diamond Exploration In Angola

By Rob Davies

There is no doubt in the mind of Brian Kiernan, chief executive of Moydow Mines, where his company’s priorities lie. And that is in Angola looking for diamonds. So when he was presented with a deal to monetise the value of Moydow’s Port Loko bauxite concession in Sierra Leone it was a simple decision. The deal is a little complex, but gives Moydow US$1.525 million on closing, and another US$5 million when the buyer, Sierra Alumina, completes a US$15 million financing, due in the autumn. If Sierra Alumina doesn’t deliver the US$5 million, then the property reverts back to Moydow.

In addition to the cash Moydow Mines will receive shares in Sierra Alumina equivalent to 11.25 per cent of the company and warrants that would take its stake up to 17 per cent on a fully diluted basis.  This transaction, which is supported by key investment fund RAB Capital, should then allow development at the Port Loko bauxite project to move ahead. The attraction of this deposit is that it has a high grade core of 25 million tonnes sitting within the total resource of 100 million tonnes...