Wholly-owned Subsidiary of Hoifu Energy Entered
Agreement in relation to Acquisition of 60%
Equity Interest in ZHCL and its Copper and
Gold Mines in Kenya
On 1 August 2013, Hoifu Mineral Resources Group Limited (hereinafter as "Hoifu Mineral"), a wholly-owned subsidiary of Hoifu Energy Group Limited(HK00007)(hereinafter as "Hoifu Energy"), entered into an acquisition agreement with Zhen Hua Company Limited (hereinafter as "ZHCL") and Mr. Li Rong Jia.
Hoifu Mineral acquired 60% equity interest in ZHCL and its mines held by Mr. Li Rong Jia for a total consideration of one Hong Kong Dollar (HK$1.00) and the option to subscribe for thirty million (30,000,000) shares of Hoifu Energy.
ZHCL is a company incorporated in Kenya with limited liability on 5 October 2005 and is principally engaged in the exploration, exploitation and production of minerals. ZHCL owns the exploration, exploitation and operations rights of Kenya Mine 253 and the exploration rights of Kenya Mine 341. Mine 253, with an area of approximately 1,056 square kilometers, is situated in the Kitui Distrcit Eastern Province, Kenya. Mine 341, with an area of approximately 417 square kilometers, is situated in Nandi County, Kenya.
On 15 April 2011, the Kenya Commissioner granted the Licence 253 to ZHCL to prospect, explore and operate industrial minerals (including but not limited to copper) in Mine 253 for a term of one year from 15 April 2011, subject to approval by the Commissioner for renewal. ZHCL has renewed Licence 253 this year and the latest expiry date is 14 April 2014.
On 3 January 2013, the Kenya Commissioner granted the Licence 341 to ZHCL to exploit gold, iron ore and non-precious minerals in Mine 341 for a term of two years from 3 January 2013, subject to approval by the Commissioner for renewal.
In the event that ZHCL has satisfied all its obligations under Licence 253 and the Licence 341 respectively, it shall be entitled to the mining and operating right for a term up to twenty-one years. In the past, ZHCL has fulfilled its responsibilities and obligations under each Licences.
ZHCL has commenced exploration and exploitation related works in Mine 253. After the implementation of the exploration works organized by ZHCL, it was discovered and obtained a large reserve of ore zone in Mine 253 which has a promising copper content. ZHCL has obtained certain ore from Mine 253 and such ore has a copper content of 5.29%. ZHCL has already sold 60 tons of the copper ore to a corporation in Mainland China.
The ZHCL-owned Mine 253 and Mine 341 have well-developed transportation and communication networks, with access to the capital and ports of Kenya through the highway network.
Hoifu Energy, the parent company of Hoifu Mineral, owns the entire and part of interests in seven oil prospects situated in Madagascar, Egypt and Tunisia. If the agreed conditions of completing the transaction are fulfilled, Hoifu Energy, through its wholly-owned subsidiary Hoifu Mineral, would acquire 60% equity interest in ZHCL and its mines, allowing Hoifu Energyto diversify its overseas reserve of oil, natural gases, gold and copper ore, which is of strategic importance to the future business development of Hoifu Energy Group.
On 1 August 2013, the agreement signing ceremony for Hoifu Mineral, the wholly-owned subsidiary of Hoifu Energy, to acquire 60% equity interest of ZHCL and its mines was held at Hoifu Energy Hong Kong headquarters.
Mr. Chui Say Hoe (right), executive director of Hoifu Energy, signed the acquisition agreement with Mr. Li Rong Jia (middle) on behalf of Hoifu Mineral, the wholly-owned subsidiary, to acquire 60% equity interest in ZHCL and its mines held by Mr. Li. Dr. Hui Chi Ming (left), chairman of the board of directors of Hoifu Energy (HK00007), was also present.
Dr. Hui Chi Ming (second from the left), chairman of the board of directors of Hoifu Energy, and Mr. Lam Kwok Hing (second from the right), the executive director, attended the signing ceremony for the acquisition agreement.
ZZHCL has commenced the exploration and exploitation related works in Kenya Mine 253.
ZHCL-owned Mine 253 has multiple open copper metallogenic belt which can be detected with the naked eyes.
At Mine 253, the copper metallogenic belt is exposed after digging into some tens of centimeters from the ground surface.
The mineral ore sample from the ZHCL-owned Mine 253 contains copper content of satisfying and high commercial standards for exploitation.
ZHCL collected mineral ore with a copper content of 5.29% from Mine 253.
Copper mineral in Mine 253 owned by ZHCL has huge developing and operational value.
Mr. Li Rong Jia of ZHCL, visiting Kenya Mine 253.
ZHCL collected large quantities of copper ore with rich copper content at Mine 253.
Copper ore in simple packages, stored in warehouse at Kenya Mine 253, ready for delivery.