The global economic crisis will not affect plans by Canada's Dundee Precious Metals Inc (DPM.TO: Quote) to build a gold and copper smelter in Bulgaria, a senior company official said on Monday.
Alex Nestor, manager of investment projects at Dundee, said the company would build the $160 million plant on the site of its Chelopech copper and gold mine by 2012, despite worries about demand due to the global slowdown.
We are in intensive talks with the European Bank for Reconstruction and Development. I do not consider funding the project a problem, Nestor told a news conference.
The Bulgarian government will provide 25 percent of the total investment, and will hold a 25 percent stake in the new smelter in Chelopech, 65 km (40.4 miles) east of Sofia. Under the same deal, Dundee has agreed to pay a higher concession fee to the state.
The agreement ended a row between the Canadian investor and the new European Union member country, which delayed for more than two years issuing environment permits for two Dundee gold mines.
The new smelter will allow Dundee to raise Chelopech's maximum capacity to 3 million tonnes of ore a year from 1.2 million tonnes now. The company said it produced almost 55,000 tonnes of gold-copper concentrates in 2008.
Nestor said Dundee would invest $6 million in 2009 to modernise and expand its gold mine. It plans to produce 850,000 tonnes of ore this year, down from 900,000 in 2008 due to planned upgrade works. (Reporting by Irina Ivanova; editing by Sue Thomas)
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