China's CNNC plans to acquire Mongolian uranium resources for $53 million

Continuing its acquisition spree for the world’s natural resources to fuel the development of the its fast-growing economy, another state-owned Chinese company, CNNC Overseas Uranium Holding Ltd (CNNC Overseas), an indirect wholly-owned subsidiary of China National Nuclear Corporation (CNNC) is set to acquire Canada’s Khan Resources Inc (Khan), a Mongolia-focused uranium mine developer, for approximately C$56.5 million ($53 million).

Khan said yesterday in a statement that it had entered into a definitive agreement with Beijing-based CNNC Overseas, under which the latter had agreed to buy all of Khan’s outstanding common shares for C$0.96 per share in an all-cash deal.
Toronto-based Khan Resources Inc is engaged in the acquisition, exploration and development of uranium properties. Its current activities are focused in the Dornod province in the northeastern part of Mongolia through its subsidiary Central Asian Uranium Company Ltd (CAUC). Khan holds interests in the main Dornod uranium property, licensed for mining, and in an adjacent property, for exploration.

The Dornod property was earlier worked upon by the former Soviet Union. Khan plans to develop and operate the mine to produce approximately 3.5 million pounds (approximately 1,600kg) of uranium oxide for over 15 years. The reserves could grow significantly based on further exploration.

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