TORONTO, ONTARIO, Jan. 7, 2010 (Marketwire) -- MagIndustries Corp. ("MagIndustries" or the "Company") (TSX:MAA) is pleased to provide the following update of the company's activities.
In 2009 MagIndustries focused the majority of its corporate and technical activities advancing its wholly owned division MagMinerals Potash Corp. ("MagMinerals") that now includes a portfolio of potash projects which are all located near the Atlantic port city of Pointe-Noire, in the Republic of Congo ("ROC"). The most advanced of the Kouilou Projects which is currently under development as a 600,000 tonne/year potash plant, will now be called the Mengo Potash project and is based on the 135 sq km Mengo Mining License. The Mengo Potash project is owned and managed by MagMinerals Potasses Congo SA ("MPC") which is 90% held by MagMinerals and 10% by the ROC Government. MPC continues to carry out extensive development work to support a 600,000 tonne/year potash fertilizer operation which would represent the first phase of commercial production of the Mengo Mining License.
During 2009, project development work on the Mengo Potash project focused primarily on the completion of the first 25 brine field production wells, the installation of 11.2 kilometers of gas supply pipeline, the definition of basic engineering documentation and the completion of a full Environmental and Social Impact Assessment ("ESIA").
-- The first 25 production wells represent half of the wells required for
the start of solution mining operations to support a 600,000 tonne/year
-- The 11.2 kilometers of 16" gas pipeline represents 40% of the total
pipeline distance required to bring gas to the Mengo plant to support
both the processing and energy requirements of the potash plant. A gas
supply agreement was reached with ENI Congo in March 2009.
-- Basic engineering is currently 80% complete as is the "bill of
quantities" for a general contractor.
-- The ESIA has been prepared to meet Equator Principles to support
potential western project financing criteria. The ESIA has been
delivered to the ROC government following a workshop with the Ministries
concerned and MPC has received temporary authorization. Full approval is
an administrative process.
In 2010 MPC will focus on the start of plant construction. As a result no further brine well drilling or gas pipeline installation will be required until the end of 2010 when plant construction activities should have reached the equivalent development timetable. The Company continues active dialogue with potential partners in the Mengo Potash project with a view to minimizing dilution and retaining the most beneficial economics possible for MagIndustries' shareholders.
As reported in late 2009 MagMinerals now holds several other exploration licenses surrounding the Mengo Mining License. MagMinerals has begun negotiations with international firms interested in the evaluation and development of new, parallel, potash projects.
MagForestry Corp., a wholly owned division of MagIndustries, owns and operates Eucalyptus Fibre Congo ("EFC"), a sustainable renewable eucalyptus plantation located in the vicinity of Pointe-Noire and overlying much of the mining and mineral licenses controlled by MagMinerals. In 2009 MagForestry completed the sale and delivery of 10 shipments of eucalyptus chips totaling about 350,000 tonnes to customers in Europe. The plantation supplies logs to EFC's $28 million harbour side chipping plant which has recently reached operating rates above design specifications. Unfortunately the wood fibre business worldwide continues to be very competitive and prices remain at very low levels which is expected to result in poor 2009 financial results for this division. Future operating results are expected to improve based on the strengthening world economy and the expected demand from the biomass energy sector.
MagEnergy Corp., a wholly owned division of MagIndustries, is developing hydro-electric opportunities in the Democratic Republic of Congo ("DRC"). MagEnergy's leading project is its public-private partnership with the DRC state utility SNEL for the rehabilitation of turbines at the important Inga hydro facility on the Congo River. As with other resource development ventures in this country, MagEnergy's partnership agreement has been under review by the DRC government for over 2 years. MagEnergy's management believes that progress has recently been made towards a possible resolution to the deadlock, but as of today no timetable can be presented.
About MagIndustries Corp.
MagIndustries is a Canadian company whose common shares are listed on the TSX and trades in Canadian currency under the symbol "MAA". The Company has 360,522,462 shares outstanding on an undiluted basis. MagIndustries' resource subsidiaries are operating and developing major industrial projects in the Republic of Congo and the Democratic Republic of Congo. More information on the Company is available at its website, www.magindustries.com.
Except for historical information, this press release contains forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties, which may cause actual results to differ materially from those statements. Those risks and uncertainties include, but are not limited to, changing market conditions, and other risks detailed from time-to-time in the Company's ongoing filings. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events in this press release might not occur.
Cusip: 55917T 102