Trigon Metals has signed a non-binding memorandum of understanding (MoU) to invest in Shandong Xinhai Mining Technology and Equipment.

In exchange, Xinhai will be appointed as the engineering, procurement and construction contractor for Trigon’s open-pit mining operations at the Kombat project in northern Namibia.

Trigon Metals president Jed Richardson said: “In partnering with Xinhai, we have gained access to both the funding and technical services necessary for the restart of mining operations at Kombat.

“Xinhai has excellent credentials in implementing projects of this nature and we look forward to a long term relationship as we execute our plans to build Trigon into a mid-tier copper producer.”

Under the terms of the MoU, Xinhai will make an investment of up to 10% of the capital requirements of the project by providing services in exchange for equity in the company.

“We look forward to a long term relationship as we execute our plans to build Trigon into a mid-tier copper producer.”

Xinhai will also assist in securing up to an additional 80% of the requirements of Kombat through debt financing.

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By GlobalData

Trigon plans to use the funds to advance the project’s engineering design and the relevant acquisition or leasing of land surface rights. The company also plans to modernise Kombat’s existing processing plant and manage its open pit operations.

The proposed transaction is subject to further evaluation of the project by Xinhai, an agreement of both companies to the deal, and other regulatory approvals.