7th Oct 2008 07:00
7 October 2008
KAZAKHMYS PLC ANNOUNCES POTENTIAL STRATEGIC PARTNERSHIP IN POWER DIVISION
Kazakhmys PLC ("Kazakhmys") announces that it has signed a memorandum of understanding with Samruk-Energy JSC ("Samruk-Energy") in which Kazakhmys and Samruk-Energy agree to consider entering into a strategic partnership and joint ownership of the Kazakhmys Power Division. Such a partnership would be expected to bring benefits of access to additional coal resources and greater integration with Kazakhstan's energy development and transmission programmes.
Samruk-Energy is a company established by the Government of the Republic of Kazakhstan to implement state policy on the modernisation of existing power stations and the construction of new power stations. The memorandum of understanding will allow Samruk-Energy to carry out due diligence on the assets within the Kazakhmys Power Division and, should the partnership proceed, it will be subject to regulatory and shareholder approval. Any transaction will be in accordance with the stated intention of seeking strategic partnerships for these assets.
Oleg Novachuk, Chief Executive of Kazakhmys, said: "Samruk-Energy, with their access to substantial coal assets, would be an excellent partner for our power division and we look forward to seeing how we can develop a relationship with them to optimise the business' potential. Such a partnership could further support the upgrading of the Ekibastuz power station, the largest power generator in Kazakhstan, and bring it up to its maximum capacity at the earliest opportunity."
For further information please contact:
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Kazakhmys PLC |
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| John Smelt |
Head of Corporate Communications |
Tel: +44 20 7901 7882 Tel: +44 78 7964 2675 |
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Olga Nekrassova |
Financial Analyst |
Tel: +44 20 7901 7814 |
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Merlin |
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David Simonson |
Tel: +44 20 7653 6620 |
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|
Tom Randell |
Tel: +44 20 7653 6620 |
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Leonid Fink |
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 2007 from own ore was 341 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 2007, it produced 45 thousand tonnes of zinc metal and 133 thousand tonnes of zinc concentrate. Kazakhmys is the fourth largest silver producer in the world (19 million ounces produced in 2007). Kazakhmys Gold, which acquired Eurasia Gold Inc in July 2007, includes substantial new development and exploration opportunities. The Group produced 146 thousand ounces of gold in 2007 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 3.4 million tonnes of coal in 2007.
Kazakhmys Petroleum has acquired the East Akhzar 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.
Samruk-Energy JSC was established in May, 2007 with the aim to elaborate and realize long-term state policy on modernization of existing and construction of new power generating units. The purpose of creation of unified body for management of state power assets is to provide long term and stable growth of the Company's stock price.
Objectives of Samruk-Energy JSC
Providing effective management of power assets which belong to Holding Samruk and its affiliated companies.
Introduction of complex approach to investing policy.
Realization of state policy on modernization of existing and construction of new power stations
Participation in realization of state policy on renewable power sources, mainly - hydro power
Participation in realization of state policy on rational use of primary power sources, especially coal and hydro-power sources.
Introduction of ecologically friendly technology
Creation of a single body for management of state power resources for realization of coordinated policy in the power branch
Samruk-Energy JSC has launched several projects on creation of new power generating units, among them:
Construction of Balkhash Power Plant with capacity up to 4000 MW. Estimated cost of the construction - about 4,5 billion USD.
Construction of Moynak Hydro Power Plant with capacity up to 300 MW.
Expansion of Ekibastuz Power Plant - 2.
JSC Samruk-Energy manages assets of JSC KazKuat (Moynak HPP, Shardara HPP), Ekibastuz Power Plant-2, JSC Mangystau PDC and owns assets of Ust-Kamenogorsk, Bukhtarma and Shulbinsk HPPs.
Related Shares:
KAZ.L