COPPER-GOLD DEAL: Inmet trades Ok Tedi stake for NSR

PAPUA NEW GUINEA — Inmet Mining of Toronto has agreed to exchange its 18% equity interest in the Ok Tedi copper-gold mine for a 5% net smelter return (NSR) royalty. The company says the agreement is neutral on a net value basis and it will no longer be liable for future operating and capital costs incurred by the operating company.

The operating company, known as Ok Tedi Mining Ltd., is 52% owned by PNG Sustainable Development Programme Ltd. and 30% owned by the Independent State of Papua New Guinea. Both have consented to the arrangement. BHP Billiton, former owner of a 52% interest, has also been consulted. Approval of the Government of Papua New Guinea is also required.

The agreement also calls for Inmet to receive a payment of approximately US$30 million, equal to 18% of Ok Tedi's working capital. The NSR amounts are to be paid quarterly.

The Ok Tedi mine was opened in 1984 and is expected to exhaust the reserves in 2013.

Inmet is involved in two copper development projects, Petaquilla in Panama and Las Cruces in Spain. It also mines copper and zinc at Cayeli in Turkey, Pyhasalmi in Finland and Troilus in Canada. Learn more at www.InmetMining.com.