KYM Mineral, Samana Citra extend mining due diligence period

KYM Mineral Sdn Bhd of Malaysia and PT Samana Citra Agung (SCA) have agreed to extend the period of the due diligence exercise in the iron sand mining project, Aceh, for a further two months to February 21, 2012.

KYM Holdings Bhd said on Friday that the extension referred to its announcements dated September 22, 2011, September 26, 2011 and September 29, 2011 in relation to the Memorandum of Agreement signed on September 22 between KYM Mineral, an wholly owned subsidiary of KYM and PT Samana Citra Agung, for the development of the iron sand mining project.

Samana Citra as the holder of the mining concession wishes to grant KYM Mineral the rights to operate, mine, process and sell the products from the 158-hectare iron sand mining concession at Aceh province, Sumatra.

For a period of three months from the date of agreement, KYM Mineral shall have the exclusive rights to conduct and complete a due diligence on the Project. If the due diligence has not been completed after three months, and/or if the outcome of the study is not satisfactory in KYM Mineral?s opinion, either party shall have the rights to terminate this MOA.

If KYM Mineral is satisfied with the outcome of the due diligence, KYM shall have the absolute rights to proceed or commence mining operation, including setting up of a processing plant at or near the concession. The time frame to establish the processing plant is anticipated to take not longer than six (months.

Upon commencement of operations, the agreement may be ended if KYM Mineral is of the opinion that the agreed area is no longer productive or not economic value or is improper to do so.

KYM Mineral shall submit such notice in writing along with data of studies made, six months in advance of any such intention. (romel)