Weekend Lounge STT 4 -6 July, page-75

Entry for STT List HIG

PNG Nickel Producer plus Copper Gold developer

Mkt Cap $43m Cash $8m with a further $5m coming from PNA via share subscription at 8c shortly

Ramu deposit
Ownership: The Ramu mine and Basamuk process plant is a joint venture between Highlands, the PNG Government and Landowners and a consortium of Chinese partners led by Hong Kong and Shanghai listed Metallurgical Corporation of China Limited (MCC). Highlands has an 8.56% interest in the project which will increase to 11.3% at no cost after internal project debt has been repaid from operating cash flow. Highlands also has an option to acquire an additional 9.25% at fair market value which could increase its interest to 20.55%. Operatorship: The project's operator and majority owner is Hong Kong and Shanghai listed Metallurgical Corporation of China Limited (MCC). MCC ultimately holds a 61% interest in MCC Ramu NiCo Limited which holds an 85% interest in the Project, with a number of other Chinese end user entities holding the remaining 39% of MCC Ramu NiCo Limited. Free Carry: The Ramu project debt funding is non-recourse to Highlands with Highlands' equity interest free carried. From commencement of production, Highlands is able to have access to its pro-rata 8.56% share of Ramu's post-debt servicing net cash flow and control of the product.


Frieda Copper Gold Deposit
About Frieda: The Frieda copper project is PNG's largest undeveloped copper-gold project and one of the top 10 undeveloped open pit copper mines in the world. With a resource inventory of 13 million tonnes of copper, 20 million of gold and 49 million ounces of gold, Frieda has three times the in ground metal content of all the copper gold extracted in the past 25 years from PNG's Ok Tedi copper mine. The Frieda district inventory of 13 Mt of copper is more than 2.5 times the 5.3 Mt of contained copper at the Panguna deposit in Bougainville (1.8bn tonnes of indicated and inferred resources at 0.34% copper) and more than Newcrest Harmony's proposed underground Wafi Golpu project which contains 9 Mt of copper and 28 million ounces of gold.

HIG will retain a 20% free carried interest with PNA funding the deposit to a development ready state.

Company also has many other promising exploration projects


HIGs 10% interest in Ramu alone should be worth $200m to HIG or well over 20c
given the $2.1Billion development cost I'm surprised the Chinese haven't moved to take HIGs interest or at least the extra 10% option over Ramu they have