20th Mar 2009 07:00
20 March 2009
KAZAKHMYS PLC ANNOUNCES EARLY COMPLETION OF THE AES MANAGEMENT CONTRACT AT EKIBASTUZ GRES-1 AND MAIKUBEN WEST COAL MINE
Kazakhmys PLC ("Kazakhmys" or the "Group") today announces that it has agreed the early completion of the contract with AES, so that management of the Ekibastuz GRES-1 power plant and Maikuben Coal Mine will transfer to Kazakhmys.
The management contract was due to run until December 2010 and included earn out fees of up to $375 million, based on profitability and the successful delivery of the capital development programme. The early completion agreement includes an earn out of $80 million for the financial year 2008, payable in April 2009, and a single reduced payment of $102 million to be paid in January 2010.
Nikolai Korobovsky, a former AES employee at Ekibastuz GRES-1, has been appointed Head of Kazakhmys Power Division, to manage all of the Kazakhmys power businesses, including Ekibastuz GRES-1, Maikuben coal mine and the three power stations and two coal mines that are owned and operated within the Kazakhmys Copper Division.
Kazakhmys' Chief Executive Oleg Novachuk said, "I should like to thank AES for their work with us over the past year and in helping the transition to Kazakhmys management. This agreement reduces our cash commitments, which is welcome in the current environment. It should also allow us to create a more integrated approach to all of our power facilities, which together represent over 20% of Kazakhstan's power output."
For further information please contact:
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Kazakhmys PLC
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John Smelt
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Head of Corporate Communications
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Tel: +44 20 7901 7882
Tel: +44 78 7964 2675
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Olga Nekrassova
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Financial Analyst
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Tel: +44 20 7901 7814
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Zulfira Mukhamedyarovа
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Senior Manager – Media Relations
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Tel: +77 27 266 317
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Merlin
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David Simonson
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Tel: +44 20 7653 6620
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Tom Randell
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Tel: +44 20 7653 6620
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Leonid Fink
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Tel: +44 20 7653 6620
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Notes to Editors
Kazakhmys PLC is a leading international natural resources group, listed in the UK and Kazakhstan, with significant interests in copper, gold, zinc, silver, power generation and petroleum.
It is the largest copper producer in Kazakhstan and one of the top ten worldwide with 20 mines, 10 concentrators and 2 smelters. Kazakhmys copper operations are fully integrated from mining ore through to the production of finished copper cathode and rod. Total copper cathode produced in 2008 from own ore was 343 thousand tonnes. Production is backed by a captive power supply and significant rail infrastructure. Kazakhmys also owns MKM, an upstream copper products fabrication company in Germany, which produces a range of pre- and semi-finished copper and copper alloy products.
Kazakhmys Copper produces significant volumes of other metals, including zinc, silver and gold. In 2008, it produced 48 thousand tonnes of zinc metal and 137 thousand tonnes of zinc concentrate. Kazakhmys is the fourth largest silver producer in the world (17 million ounces produced in 2008). Kazakhmys Gold, which acquired Eurasia Gold Inc in July 2007, includes substantial new development and exploration opportunities. The Group produced 179 thousand ounces of gold in 2008 and has measured and indicated resources of 2.3 million ounces.
Kazakhmys Power owns the recently acquired coal fired Ekibastuz GRES-1 plant, the largest in Kazakhstan with a nameplate capacity of 4,000 MW. In addition, it owns the Maikuben open cast coal mine, supplying around 20% of the power plant's fuel requirements producing over 3.6 million tonnes of coal in 2008.
Kazakhmys Petroleum has acquired the East Akzhar exploration block, with an area of 602km², located on the eastern fringe of the Caspian depression.
The Group is part of the FTSE-100 index of companies listed on the London Stock Exchange and is also listed on the Kazakhstan Stock Exchange (KASE). It had revenues of $5.3 billion in 2007 with EBITDA of $2.3 billion. The Group employs some 65,000 people, principally in Kazakhstan. The Group's strategic aim is to diversify and participate in the development of the significant natural resource opportunities in Central Asia.
Related Shares:
KAZ.L