EMED Mining acquires 100% of Andalucian copper mine

Cyprus-based minerals group, EMED Mining Public Limited, is in the process of acquiring 100% of Proyecto Rio Tinto, a copper mine founded by the British in the Spanish region of Andalucia, in 1873.

The company is buying MRI Group’s 49% stake in the mine for an initial consideration of £8.2 million in shares.

The deal involves a deferred payment of up to £35 million, which will be dependent on production targets being met and securing regulatory approvals.

The mine, which has proven reserves of 600,000 tonnes of copper, was last worked by a local co-operative but closed in 2000.

EMED plans to reopen the site in the first quarter of 2009; output should begin in the fourth quarter of next year and the company is optimistic that it will be able to extract more than the proven reserves

The total cost of the project, including the deferred payments to MRI, is estimated at around £60 million.

Under the agreement, an MRI subsidiary has been appointed as the marketing and sales agent in relation to the sale of copper-concentrate product from the mine.

According to EMED, the Rio Tinto Mine is the most significant known mineral deposit in Andalucia and its potential restart would be a major event in the region.