FTSE 250-listed copper miner Kazakhmys yesterday said it has agreed to sell its 50 per cent stake in Kazakhstan’s largest power station for $1.3bn (£790m), as it warned that development of its Bozshakol mine would cost more than expected.
The firm also said yesterday that it has hired Shenzhen-listed Non Ferrous China as a second principal contractor on the Bozshakol project.
“The group anticipates that there will be an increase in the overall budgeted cost for the project of around $350m, however the appointment of the additional contractor will provide greater assurance that the project remains on track for first production in 2015,” the firm said in a statement.
The projected capital expenditure has now increased from $2bn to $2.35bn.
Kazakhmys is selling its interest in the Ekibastuz power station to Kazakhstan’s sovereign wealth fund Samruk-Kazyna.
“We believe that this disposal realises an attractive return on the group’s original investment and will allow the group to focus on the development of its large scale, long life, low-cost copper growth projects,” said Kazakhmys’ chairman Simon Heale.
Kazakhmys has been focusing on its core activities of late. It sold its stake in scandal-tainted miner ENRC back to its founders in October. Shares fell two per cent.