London Mining reaches agreement with consultant over Marampa royalty

London Mining and consultant Fraser Turner have settled theirchinese 3 foot simons cone crusher parts dispute over additional royalty payments from the Marampa iron ore mine in Sierra Leone.

Under the terms agreed, London will pay Fraser Turner £4.73 million, comprising £2.35 million cash and £2.38 million in new shares.

In addition, Fraser Turner will receive a total royalty equal to 0.3 per cent of the price London Mining receives from sales of iron ore from Marampa, net of the existing royalty payable to Sierra Leone.

London Mining, meanwhile, has first refusal on any potential new iron ore mining opportunities in West Africa identified by the consultant.

Fraser Turner has also agreed not to sell any of the shares it receives for at least two years, while London Mining has agreed to make up the difference if the share price is not worth £7 after three years.

The original consulting agreement between the firms was terminated in 2007. That included a 10 US cents sold royalty, which was not in dispute, but Fraser Turner had also claimed an additional 2 per cent royalty on revenue from Marampa, which was rejected by London Mining.

Last month, London Mining said it was on track to meet its full year target of 1.5 million tonnes per annum of iron ore from Marampa.

It produced 300,000 dry metric tonnes of iron ore in the first quarter and shipped over 230,000 dry metric tonnes to Europe and China.