TNG Limited receives key Chinese government approval for A$13.4m investment

TNG Limited (ASX: TNG) has moved another step closer to developing the Mount Peake Iron-Vanadium Project, with a key Chinese government approval received.

Notice of approval has now been received from the Jiangsu Provincial branch of the National Development and Reform Commission (NDRC) for the proposed transaction with the state owned enterprise Jiangsu Eastern China Non-Ferrous Metals Investment Holding Company (ECE).

This ticks off another step towards completing the broader transaction with ECE, which includes a $13.4 million funding injection, and a Strategic Alliance.

This alliance will underpin the feasibility and development of the Mount Peake Project, and commercialisation of TNG’s proprietary TIVAN™ hydrometallurgical process.

Paul Burton, managing director, said that he was pleased to announce the receipt of this key Chinese Government approval, which marks another important step towards completing the overall transaction.

“Other steps include TNG shareholder approval and approval from the Australian Foreign Investment Review Board.

“We are looking forward to concluding this transaction, which will lay the foundations for the development of the Mount Peake Project as the cornerstone of a substantial ferrous metals business."


The terms of the agreement

Under the terms of the partnership, ECE will make a $13.4 million investment for a 30% cornerstone stake in TNG - priced at $0.11 for around 122 million shares.

Importantly for existing shareholders, the investment has been struck at a premium to the $0.093 price before TNG entered the trading halt to make the announcement.

The transaction is subject to due diligence, TNG shareholder approval and other regulatory approval.

A A$2 million loan facility has also been made available to TNG to provide interim working capital prior to the end of August to underpin the ongoing Pre-Feasibility Study and metallurgical test work program, provided by a private company introduced by ECE.


Pre-Feasibility Study progressing on schedule and on budget

The Mount Peake Pre-Feasibility Study is progressing on schedule, with final metallurgical optimisation work, engineering, process design, hydrology, native title and environmental studies underway.

The project already hosts an Inferred JORC Resource of 140Mt at 0.3% V205, 5% Ti02, 24% Fe.

TNG has an exploration target for the area of between 500 – 700 million tonnes at 0.2-0.4% V205, 5-9% TiO2, 25-35% Fe.

The exploration licences cover an extensive 2000 square kilometres.

Originally published at: http://www.proactiveinvestors.com.au/companies/news/20046/tng-limited-receives-key-chinese-government-approval-for-a134m-investment-20046.html