MONGOLIAN COAL ACQUISITION• Option to acquire substantial Mongolian coal licences from international coal developer
• 8 licences well located with access to existing infrastructure
• In‐country technical team established and ready to commence
C @ Limited (“CEO”) is pleased to announce it has entered into a binding and exclusive
agreement with an international coal developer that has a significant position in the coking and thermal coal industry in Mongolia. The agreement provides CEO with an option to
acquire 8 highly prospective coal exploration licenses in the South Gobi, near the Chinese border, and adjoining Ovorhangay province in southern Mongolia. The licences in
Ovorhangay are close to existing mining operations.
This strategic acquisition is the first step in CEO’s strategy to actively acquire and develop high quality coking and thermal coal interests in Mongolia. CEO has the structure and
technical team in place to successfully develop these assets.
Managing Director Mr Mark Early said: “I am delighted to announce that we have secured an exclusive option on a number of coal licenses in the South Gobi and Ovorhangay provinces that are well located to existing market infrastructure, and are a good fit for CEO. Notably the licenses are unencumbered and allow us to acquire the full licence rights. “
The option period commenced on 19 April 2011 and will continue for a period of 10 weeks, during which time CEO will complete due diligence on the licenses to the extent it deems necessary prior to exercising the option. The due diligence process will include a significant mapping, drilling, trenching and coal sampling program. CEO will provide further announcements on its findings over the course of the due diligence period.
CEO has made a non‐refundable payment of US$100,000 as consideration for entering into the option agreement, which will be credited against the total acquisition price.
If CEO exercises its option to acquire the coal licences, completion will occur once the parties have negotiated and signed a sale and purchase agreement and CEO has made the final consideration payment of US$7.7 million.