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Nautilus jumps on possible support vessel reprieve

Marine mining pioneer Nautilus Minerals jumped 20% in Toronto this week after it revealed plans to form a new joint venture with arm’s length third parties to fund completion of its production support vessel (PSV) in China.
Nautilus jumps on possible support vessel reprieve Nautilus jumps on possible support vessel reprieve Nautilus jumps on possible support vessel reprieve Nautilus jumps on possible support vessel reprieve Nautilus jumps on possible support vessel reprieve

Nautilus Minerals' PSV under construction

Staff Reporter

But the matter is being complicated by the junior having no further claim of ownership to the PSV.

A subsidiary of the MDL Energy group of companies that provides offshore construction services for the oil and gas industry in South East Asia, India, and internationally, Ocean Energy Ventures (OEV) said late in November it had together with Quippo Oil and Gas completed the acquisition of the vessel.

Under a contract inked in Shanghai on July 26 and which became effective on September 3, the vessel is officially owned by MDL and has in fact been re-dubbed ‘Amaya Explorer'.

MDL said OEV's dialogue for the charter of the vessel to Nautilus was terminated on October 5 and Nautilus had been instructed to remove all its equipment off the vessel. OEV is now re-purposing the vessel.

"We are delighted to have concluded the contract for the purchase of Fujian Mawei hull MW301-1. The vessel hull fits well with our future plans and we are excited about this first step on a new journey for us," MDL CEO Kulpreet Sahni said at the time.

Early in July, Fujian Mawei Shipbuilding, the owner of the shipyard where Nautilus' PSV is being built, rescinded the shipbuilding contract between the shipyard and Marine Assets Corp Goliath, the contractor appointed by Nautilus to procure a PSV on its behalf, for failing to pay the third instalment of the contract price of about US$18 million.

According to Nautilus, the shipyard has continued to install components of the company's seafloor production equipment on the PSV, with the latest being the installation of an operating console in mid-November.

The PSV will be used to mine copper and gold ore from extinct hydrothermal vents at the Solwara 1 project at the bottom of the Bismarck Sea, offshore Papua New Guinea.

Vancouver-based Nautilus said the purpose of the new JV would be to fund the acquisition of the PSV and integration costs of installing mining equipment.

Mining Journal has reached out to both parties for clarification.

Nautilus also said Monday it was currently in discussions with its lending partner Deep Sea Mining Finance to extend the maturity date of the existing secured loan facility, which is currently due on January 8, 2019. This was expected to provide Nautilus with enough time to complete JV and related transactions.

Mining at Solwara 1 will use three remotely operated robots weighing up to 310t on the sea floor to cut and crumble the old hydrothermal vents, which would be pumped to surface in a slurry, before being stored and transferred to other vessels for downstream processing and refining. But the impact of extracted seawater that would then be pumped back to the seabed remains little understood and remains the target of significant environmental opposition.

Nautilus' equity rose 20% in Toronto on Monday to C6c, some ways lower than its previous peak of C39c in February. The company has a market value of $41 million.