General Moly reported on March 20 that its legal counsel had suspended until further notice work on the $665-million term loan that was being negotiated with China Development Bank (CDB) for the development of the Mt. Hope molybdenum project in Eureka County, Nevada. The suspension related to media reports that Liu Han, chairman of Sichuan Hanlong Group, had been detained by Chinese authorities. Hanlong owns a 13% interest in General Moly, and Hanlong or an affiliate is obligated to arrange and guarantee the term loan throughout its life.
Media reports indicated that Liu Han was being held on suspicion that he helped hide a brother who was a murder suspect. The capture of his brother as a “major murder suspect” was also reported, but no other details were available. General Moly was seeking clarification from Hanlong as to the implications for the company.
General Moly CEO Bruce D. Hansen said, “We have been making good progress negotiating the term loan and are disappointed that this work has been suspended until further clarification is received from Hanlong. We hope to re-establish term loan negotiations with Hanlong and CDB in the near-term but will concurrently assess other financing alternatives.”
General Moly reported on March 8 that early construction activities were progressing as planned at Mt. Hope, including cultural clearance, clearing and grubbing, wood harvesting, and the development of wells and water pipelines. Kautz Environmental Consultants had completed field mitigation activities for all 32 cultural sites identified in the Phase I Cultural Mitigation of the initial construction program. Official releases from the U.S. Bureau of Land Management and the State Historical Preservation Office had been obtained for 27 of the 32 cultural sites.
Ames Construction mobilized in early January and had cleared and grubbed approximately 1,000 acres at the Mt. Hope site in preparation for starting major earthworks. The mine, process plant, and tailings dam areas and associated roads had been substantially cleared. Ames also had begun work on 8 miles of water pipeline to supply construction water from the permitted well field to the plant site.
The Mt. Hope project operating company, Eureka Moly LLC, had ordered or purchased most of the project’s long-lead milling equipment, haul trucksvand mine production drills, and had entered into a preliminary agreement for the purchase of electric shovels. While equipment procurement was in progress, firm orders for some loading equipment and some other process equipment were awaiting completion of project financing.
Mt. Hope is a large, high-grade project that has an expected mine life of more than 40 years. The project is expected to produce about 40 million lb/y of molybdenum in concentrate over its first five years of operations.