tin, page-2

Wolf shares soar after tin mine purchase
05/12/2007 07:11:40 PM


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Shares in Perth-headquartered Wolf Minerals Ltd soared on Wednesday after the company announced plans to reopen a tin and tungsten mine in England's south west that has been closed for more than 60 years.

The company said strong demand, low supply and buoyant prices for tin made the Hemerdon open-pit mine attractive to Wolf, which relisted on the Australian stock exchange on Wednesday after going off the boards on June 12.

Its shares closed 91.73 per cent higher to $2.55.

Wolf suspended itself from the ASX while negotiations for the mine were progressing.

The company has agreed to buy the mine for $1 million and pay about $160,000 a year in rent over a 40-year lease, plus a two per cent royalty.

Wolf has entered into an agreement to purchase freehold land and the rights to other minerals from Imerys Minerals Ltd that operates open-pit clay mining adjacent to Hemerdon.

Wolf is aiming for a mine life of 15 to 19 years but must first clear planning hurdles.

A previous operator, North America's AMAX, applied for permission to develop the mine, which was granted in 1986 and remains valid until 2021.

In an announcement on Wednesday, Wolf said the project was advanced enough to allow a rapid reassessment of AMAX's 1981 feasibility study.

A British news report on Tuesday said Wolf aimed to create 500 new jobs "but locals fear the mine will engulf some homes in the village of Hemerdon".

After hitting $US17,500 per tonne last month, tin is currently priced north of $US16,000 per tonne and some analysts predict it could hit $US25,000 per tonne within the next year.