Thor Mining signs offtake deal with Chinese trader Wed Mar 12, 2008 7:20am EDT Email | Print | Share| Reprints | Single Page| Recommend (0) [-] Text [+]
LONDON, March 12 (Reuters) - Australian miner Thor Mining (THRL.L: Quote, Profile, Research) (THR.AX: Quote, Profile, Research) has signed a deal to supply hi-tech metals tungsten and molybdenum to a Chinese state-owned trading firm, Thor said on Wednesday.
The deal means Thor can go ahead with raising the money it needs to bring the Molyhil mine to production.
Once operational, Molyhil in the north of Australia will supply its entire output of tungsten and molybdenum -- minerals used to harden steel -- to CITIC, one of China's largest state-owned firms.
"CITIC has been seeking to secure a long-term supply of tungsten and molybdenum, which are important raw materials for the group's expanding steel business in China," said Ting Hu Guo, executive director of CITIC, in a statement issued by Thor to the London Stock Exchange.
Prices of tungsten ore WMITE-LON have trebled in the past five years, while molybdenum oxide MLY-OXIDE-LON has risen seven-fold, as Chinese steel production has boomed in line with the country's rapid economic growth.
In an interview with Reuters in November, Thor's chief executive John Young said it would cost A$63 million to bring the mine to production, which it aims to do by early 2009 [ID:nL21142981].
Thor's London-listed shares were up 31 percent at 8.50 pence by 1029 GMT.
(Reporting by Daniel Magnowski; editing by Chris Johnson)
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