Major copper agreement

Copper miner GBM Resources has signed an agreement with the largest buyer of copper concentrate in the world.

Australian copper explorer GBM Resources has signed an agreement with Tokyo-based Pan Pacific Copper, the world’s largest buyer of copper concentrate.

The deal could see Pan Pacific spend up to $55 million on the development of new copper-gold exploration and mining projects in northwest Queensland.

GBM Resources today announced the signing a non-binding letter of intent (LOI) with the Japanese company, aiming to complete a binding agreement by 31 January 2010.

“The terms of the agreement are a win for both parties, whereby the strategic objectives for both will be met if it leads to a world class copper-gold discovery,” GBM managing director Peter Thompson said.

According to the terms of the deal, Pan Pacific will earn a 51% interest in seven exploration permits and nine exploration permit applications in GBM’s tenements in the Mount Isa region by spending $15 million within the first six years.

After earning its initial 51%, Pan Pacific will then be entitled to increase its share of the venture to 90% by spending a further $40 million on exploration and development of the tenements over the following five years, GBM said.

“This is shaping up to be a very important agreement for GBM, which will enable us to fast track exploration of some highly prospective projects and potentially generate significant rewards for our shareholders,” Thompson said.

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