rail partners gone

MARKET RELEASE 6 November 2013
CUDECO REGAINS CONTROL OF 100% OF STRATEGIC MULTI LOAD RAIL FACILITY IN CLONCURRY
Directors are pleased to advise shareholders that CuDeco Ltd will now control 100% of the valuable Cloncurry Multi-load Rail Facility to be constructed outside the major regional township of Cloncurry N.W. Queensland.
The Company had originally controlled 100% of the project until the company was approached by the previous QLD State Government approximately 3 years year ago, requesting the Company allow Glencore Xstrata (Xstrata) and Minmetals (MMG) to enter into the facility via a JV with Xstrata, MMG and CuDeco with one third ownership each. The company “graciously” bowed to previous Governments request. Over the past 3 years the JV partners had completed a range of requirements and conditions, including road design, rail design, environmental, and native title and cultural heritage issues. The original design by CuDeco was for a 1200m spur line off the main Mt Isa/Townsville rail line. Subsequently, the design changed from a spur off the main track rail to a balloon loop, to accommodate the 3 individual JV partners.
As a result of both Xstrata and MMG recently modifying their mining operations and timetables at their respective projects, the Mining Lease application, being the instrument of ownership, of the multi load rail project will be transferred from the JV to CuDeco. As a result, CuDeco becomes the 100% owner of the Project.
The Project was initially designed to handle all of CuDeco’s concentrates produced from the Rocklands Copper Project and to assist other mining companies with transport of their concentrates to the Port of Townsville on a commercial basis, through a 100% CuDeco owned facility. Prior to the JV, the Company was dealing with enquiries and letters of intent from other third party mining companies in the Mt Isa/Cloncurry region to use the facility, but under the JV arrangement we were restricted.
With CuDeco now in control of 100% of the Project after the transfer of the Mining Lease over the land for the facility, we can resume discussions with other mining companies to gain access to the facility on a user pay commercial basis. This was always our intention but was changed due to the influence of the former QLD Government. The Cloncurry Multi Rail Load facility, combined with the CuDeco Townsville Port facility will allow a strategic business model to evolve with local mining companies wanting “mine site to port” transport for their production output. The rail line from Cloncurry is continuous to our Port Facility in Townsville. The storage capacity once completed will allow storage of over 400,000 tonnes of mineral concentrate capacity, and cater for four individual groups, at any one time. The CuDeco Port facility has also been allotted a designated ship loading berth as part of our development approval. The shiploader
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also to be owned by CuDeco is capable of loading a ship at the rate of 2,000 tonnes per hour direct from our storage facility.
With CuDeco, now in control of 100% of both the Cloncurry Multi-load and the Townsville Port facility, this allows discussions with the major stevedoring companies and international groups that want to participate in the project to proceed without interruption. With CuDeco regaining control of the facility it allows the financing options to be clean cut without the obvious distractions of third party involvements, thus allowing CuDeco to devise a new business model. The full control allows a seamless opportunity for CuDeco not only have entire independence on policy, planning and control, but also allows the company to enhance value to CuDeco shareholders by developing a commercial business model based on a user pay model.
Both the Townsville Port and Cloncurry Multi-load Rail Facility are controlled by CuDeco Logistics Pty Ltd a wholly 100% owned subsidiary of CuDeco Ltd.
On behalf of the Board
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