JOHANNESBURG (miningweekly.com) – Dual-listed Central Rand Gold (CRG) has entered into a memorandum of understanding (MoU) with China-based mining machinery manufacturer Zhejiang Golden Machinery Plant (ZGMP), establishing a framework for information sharing and collaboration between the companies.
In the short term, the partnership would focus on determining whether ZGMP could assist CRG in the upgrade and optimisation plan that was currently under way at its existing metallurgical plant, through potentially supplying the appropriate plant and machinery at a competitive price.
In the longer term, and once all the appropriate feasibility studies had been completed for a new mining target area, the parties would consider whether ZGMP could assist CRG in expediting the planning, design, engineering and construction of its above-ground plant.
“The signing of the MoU with ZGMP is an exciting progression in the development of CRG that complements the work that the company is undertaking to advance its ‘string of pearls’ strategy along the 40 km strike at the heart of the world-famous Witwatersrand goldfield,” CRG CE Johan du Toit said.
He added that the potential strategic partnership with ZGMP provided CRG with a strong platform to transform into an emerging midtier producer.
In terms of the MoU, should ZGMP ultimately provide CRG with any equipment or services, the company could elect to pay ZGMP through the issuance of shares in CRG rather than in cash, subject to the required shareholder approvals.
CRG noted that this option would have the benefit of reducing balance sheet strain, while aligning its interests with those of ZGMP.