TORONTO, Sept. 1 /CNW/ - Equinox Minerals Limited (TSX and ASX symbol: "EQN") ("Equinox" or the "Company") is pleased to report that its wholly owned subsidiary, Lumwana Mining Company Limited ("LMC"), has exercised its option to extinguish the right held by Phelps Dodge Mining (Zambia) Limited ("PD Zambia") to receive a 1% Lumwana Project ("Lumwana") net smelter return royalty under the purchase and sale agreement dated December 8, 2004 (the "Purchase and Sale Agreement") between PD Zambia and the Company.
Between August 1999 and June 2003, Equinox earned a 51% interest in Lumwana as a result of funding a bankable feasibility study. Under the Purchase and Sale Agreement, Equinox acquired the remaining 49% interest in Lumwana.
The Purchase and Sale Agreement provided that PD Zambia would retain the right to a 1% Lumwana net smelter royalty which could be terminated by the Company at its option under certain conditions. Exercising its option with a payment of US$12.8 million to PD Zambia, LMC has met the required conditions and extinguished the 1% Lumwana net smelter royalty thereby terminating all remaining obligations and/or associations between Equinox and the former holders.
Commenting, Craig Williams, Equinox President and CEO said: "Given the development and operating phase that Lumwana mine is now at, and looking at the inherent value of these wholly owned mining assets judged today compared to their value in 2004, we believe this is a very good deal for Equinox and its stakeholders".
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Craig R. Williams - President & Chief Executive Officer
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For information on Equinox and technical details on the Lumwana Project
please refer to the company website at www.equinoxminerals.com
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For further information: Craig R. Williams (President and Chief Executive Officer), Michael Klessens (V.P. Finance and CFO), Phone: +61 (0) 8 9322 3318, Email: equinox@equinoxminerals.com Or Kevin van Niekerk (V.P. Investor Relations), Phone: (416) 865-3393, Email: kevin.van.niekerk@equinoxminerals.com
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