COMPLETION OF THE ACQUISITION OF 60% EQUITY
INTEREST IN ZHCL AND ITS COPPER AND GOLD
MINES IN KENYA BY HOIFU ENERGY
All the conditions precedent in relation to acquisition of 60% equity interest in ZHEN HUA COMPANY LIMITED (hereinafter as "ZHCL") and its copper and gold mines in Kenya held by Mr. Li Rong Jia by Hoifu Mineral Resources Holdings Limited (凱富礦產資源控股有限公司) (hereinafter as "Hoifu Mineral"), a wholly-owned subsidiary of Hoifu Energy Group Limited (HK00007) (hereinafter as "Hoifu Energy"), have been fulfilled and the completion of the Acquisition took place on 26 August 2013. ZHCL has become a subsidiary of Hoifu Energy. Following the successful acquisition of the equity interest in copper and gold mines in Kenya by Hoifu Energy, which is principally engaged in oil and natural gas business, it would diversify its resources and reserves, which are of strategic importance to the future business development of Hoifu Energy Group.
Pursuant to the Licence 253 and relevant provisions of the Mining Act of Kenya, ZHCL is authorized to explore, mine and operate industrial minerals (including but not limited to copper) in Kenya Mine 253 for a term of one year from 15 April 2011, subject to approval by the Commissioner for renewal. The current expiry date of the Licence 253 is 14 April 2014.
On 3 January 2013, the Kenya Commissioner granted the Licence 341 to ZHCL for prospecting and exploration of minerals such as gold and iron ores in Kenya Mine 341 for a term of two years from 3 January 2013, subject to approval by the Commissioner for renewal.
Pursuant to the Mining Act of Kenya, ZHCL is required to carry out an exploration programme in Kenya Mine 253 and Kenya Mine 341 and complete the agreed minimum work obligation. Following the completion of and subject to the agreed minimum work obligation, ZHCL shall be entitled to further or other rights of Kenya Mine 253 and Kenya Mine 341, or shall be granted with mining rights of one or more mines for a period not exceeding twenty-one years.
Since ZHCL has fulfilled and completed its past responsibilities and obligations stipulated under the Licence 253, ZHCL shall be entitled to carry out exploration and mining related works in mines approved and registered by the Ministry of Mining of Kenya.
As ZHCL has been carrying out exploration works for Kenya Mine 341 and has not yet fulfilled its exploration work obligation stipulated under the Licence 341 at this stage, ZHCL has only obtained the prospecting and exploration rights, but not the mining right, in respect of Kenya Mine 341. In the event that ZHCL having fulfilled its exploration work obligation in respect of Kenya Mine 341 and met the standard exploration conditions, it may apply to the Ministry of Mining of Kenya for approval and registration of mining of minerals.
In order to have a better understanding of the operating environment of the mining industry in Kenya, Dr. Hui Chi Ming, Chairman of Hoifu Energy, together with Mr. Li Rong Jia, have paid an on-site visit to Kenya Mine 253 on 19 August 2013. Through such on-site visit and analysis of the mineral resources in Kenya, they have exchanged views with relevant departments and other industry peers of Kenya and create business opportunities for the development of mining business of Hoifu Energy. In addition, Dr. Chui Say Hoe, executive director of Hoifu Energy, has also met and exchanged views on amicable terms with HON.NAJIB BALALA.E.G.H, Cabinet Secretary of the Ministry of Mining of Kenya, on 24 August 2013 in Hong Kong. The Ministry of Mining of Kenya has welcomed and showed their support towards the investment in the exploration, exploitation and mining business in Kenya by Hoifu Energy.
After the implementation of the exploration works organized by ZHCL, it was discovered that there is a large volume of ore zone in Kenya Mine 253 which has a promising copper content. ZHCL has obtained certain ore from Kenya Mine 253 and such ore has a copper content of 5.29%. ZHCL has already sold approximately 60 tons of the ore to a corporation in China.
On 18 August 2013, Uhuru Kenyatta, the President of Kenya, has paid a state visit to Beijing, China and met Chinese President Xi Jinping and Premier Li Keqiang in a friendly atmosphere to forge cooperative partnership between the two countries for further development of bilateral ties. The stable political environment in Kenya as well as comprehensive and cooperative partnership between China and Kenya has guaranteed a promising future for Kenya.
Following the acquisition of 60% equity interest in ZHCL and its copper and gold mines by Hoifu Energy, it will fully initiate and implement the exploration, exploitation and mining works at its copper and gold mines in Kenya.
In addition to the entire and part of the interests in seven oil prospects situated in Madagascar, Egypt and Tunisia owned by Hoifu Energy through merger and acquisition, Hoifu Energy has successfully acquired 60% equity interest in copper and gold mines in Kenya. As a result, Hoifu Energy managed to diversify its overseas reserve of oil, natural gas, copper and gold ore in a short period of time, and established a good operating environment for the development of natural and precious resources business of Hoifu Energy.
On 19 August 2013, Dr. Hui Chi Ming (left), Chairman of Hoifu Energy, was warmly received by Kalonzo Musyoka (right), the former Vice-President of Kenya, in Nairobi.
On 24 August 2013, Dr. Chui Say Hoe (left), executive director of Hoifu Energy, met on amicable terms with HON.NAJIB BALALA.E.G.H (right), Cabinet Secretary of the Ministry of Mining of Kenya, in Hong Kong.
On 19 August 2013, Dr. Hui Chi Ming (front row from left), Chairman of Hoifu Energy, together with Mr. Li Rong Jia, paid an on-site visit to Kenya Mine 253 and were warmly welcomed by the miners.
Dr. Hui Chi Ming (front row from left), Chairman of Hoifu Energy, paid an on-site visit to Kenya Mine 253 to inspect its copper mining operation.
A dozen centimeter deep ore zone with abundant resources could be found by removing the soil on top in Kenya Mine 253 with an area of 1,056 square kilometers.
Abundant copper resources and large volume of ore zones could be easily found in Kenya Mine 253 with an area of 1,056 square kilometers
Kenya Mine 253 is one of the rich ores in the world with abundant and high grade resources. Such ore has a copper content of 5.29%.