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General Moly Signs Off-Take Agreement with SeAH Besteel

05/16/2008 - General Moly announces the signing of an off-take agreement with SeAH Besteel Corp., Korea’s largest manufacturer of specialty steels.

General Moly Inc. announced the signing of an off-take agreement with SeAH Besteel Corp., Korea’s largest manufacturer of specialty steels.
 
The new agreement between the companies provides for the supply of approximately four million pounds per year of molybdenum for five years, beginning once Mt. Hope reaches commercial production levels. Like the ArcelorMittal off-take arrangement, the SeAH arrangement provides for a floor price significantly higher than the Mt. Hope estimated cash costs per pound, and is offset by a variable discount to spot moly prices above the floor. The floor price also is subject to escalation.
 
“We are extremely pleased to have SeAH Besteel joining our fold of strategic relationships and we will explore further strategic opportunities with the SeAH group of companies,” said Bruce D. Hansen, Chief Executive Officer of General Moly, said, Bruce D. Hansen, General Moly’s CEO. “This off-take agreement brings the total volume of floor price protected moly sales to a level of 10.5 million lbs (+/- 10%), or roughly one-third of the anticipated production that we will control from the Mt. Hope project.
 
“We view this transaction as another important step to further enhance our ability to ultimately access the debt finance markets,” concluded Hansen.
 
General Moly is a U.S.-based molybdenum mineral exploration and development company. Its primary asset—its interest in the Mt. Hope project located in central Nevada—is considered one of the world's largest and highest-grade molybdenum deposits. Combined with the company’s second molybdenum property—the Liberty project (formerly the Hall-Tonopah project), which is also located in central Nevada—the company is aiming to become the largest primary molybdenum producer by the middle of the next decade.