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Moly Mines puts Australian project on hold

JOHN LEHMANN/JOHN LEHMANN/GLOBE AND MAIL

Moly Mines Ltd. said Wednesday it has put its Spinifex Ridge molybdenum-copper project on hold due to low molybdenum prices and the effect of a high Australian dollar.

The Toronto-based company also said it has signed an agreement with financier China Development Bank that would help revise the structure of loans it has with the Chinese bank for the financing of new mining projects.

"Whilst it is disappointing that the economics do not allow us to proceed with the Spinifex Ridge molybdenum-copper mine at this stage, the strategic alliance further cements the excellent rapport we have built with CDB and supports a platform for future growth of the company," Moly Mines chief executive officer Derek Fisher said in a statement.

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Under the planned strategic alliance, China Development Bank will consider providing financial support for projects other than Spinifex Ridge under similar terms to an existing $454-million (U.S.) loan.

Moly Mines, which is based in Toronto but has its major operations and exploration projects in Australia also owns an operating iron ore mine at Spinifex Ridge.

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