China takes majority control of Rossing

Sharlien Tjambari

China is set to become the single biggest owner of Namibia’s uranium resources. This follows an announcement by Rio Tinto yesterday that it sells 68,62 % of Rössing Uranium Limited (RUL) to China National Uranium Corporation (CNUC). The sale is worth N$1,5 billion.

Rio Tinto owns 69 % of Rössing Uranium Limited which in turns owns Namibia’s Rössing Mine, some 75 km east of Swakopmund near the mining town of Arandis.
China is an already established stakeholder in Namibia’s uranium sector, through Taurus Minerals which owns 90 % of Swakop Uranium and its Husab Mine. Taurus in turn is a subsidiary of China General Nuclear Power Company (CGNPC).
In a statement yesterday Rio Tinto stated: “Rio Tinto has entered into a binding agreement with China National Uranium Corporation Limited (“CNUC”) for the sale of its entire 68.62 per cent stake in Rössing Uranium Limited (“Rössing”), owners of the Rössing mine in Namibia, for up to $106.5 million.
The total consideration comprises an initial cash payment of $6.5 million, payable at completion, and a contingent payment of up to $100 million following completion. The contingent payment is linked to uranium spot prices and Rössing’s net income during the next seven calendar years. In addition, Rio Tinto will receive a cash payment if CNUC sells the Zelda 20 Mineral Deposit during a restricted period following completion. The total consideration is subject to a maximum cap of $106.5 million.
The transaction represents the culmination of an extensive assessment of strategic options considered by Rio Tinto in relation to Rössing.  Rio Tinto chief executive J-S Jacques said the sale of our interest in Rössing once again demonstrates our commitment to strengthening our portfolio and focusing on our core assets, which deliver sector leading returns in the short, medium and long term.”Rio Tinto has a long history in Namibia and I would like to thank the many people across Rio Tinto and the communities in which we operate who have contributed to the success of Rössing. I wish them continued success under new owner-ship. Rio Tinto will work closely with CNUC to ensure a smooth transition and ongoing sustainable operation at Rössing.”
The transaction is subject to certain conditions precedent, including merger approval from the Namibian Competition Commission. Subject to these conditions being met, the transaction is expected to complete in the first half of 2019.”