London 13/07/2016 - Canada-based Strongbow Exploration Inc has formally completed its acquisition of the bankrupt and long-closed South Crofty tin mine in the UK from administrators and will now carry out an assessment of the project.
Strongbow paid 143,000 pounds for the exit from administration. It also converted all debt owed to Galena Special Situations Fund, the only secured creditor, into new common shares.
South Crofty has an active mine permit valid until 2071, subject to certain planning conditions being addressed.
"We are extremely pleased to have concluded this agreement, and look forward to moving the South Crofty Project to completion a PEA (preliminary economic assessment) and, if successful, through a feasibility study towards a production decision in collaboration with all stakeholders in this historic tin mining district," Richard Williams, president and CEO of Strongbow, said in a release.
UK administrators Wilkins Kennedy has been seeking alternative capital since 2013 when mine operator Western United Mines (WUM) issued Celeste Copper, which held 25 percent of the project, with a notice of default because of Celeste's continued failure to fund expenditure in accordance with contractual obligations.
South Crofty was Europe's last working tin mine, producing some 2,000 tonnes per year of tin in concentrate until it closed in March 1998. The mine became operational once more in April 2004 when tunnelling works were started but there were no definite production start-up dates.
Operations were focused on preparing the mine for tin extraction - actual production would take 24 months from a decision being made. There are also copper and zinc resources there.
At the time of its 1998 closure, LME tin prices stood around $5,500 per tonne. The market hit all-time highs of $33,600 in April 2011. In January this year they fell to five-and-a-half year lows of $13,085 and are currently around $17,950.
(Editing by Mark Shaw)