China Govt: Chihong Mining, Canada Selwyn Seal Zinc Deal

BEIJING, June 25 -- Chihong Canada Mining Ltd., a subsidiary of Yunnan Chihong Zinc & Germanium Ltd. (600497.SH), signed a joint venture agreement with Canada's Selwyn Resources Ltd. (SWN.V) during President Hu Jintao's visit to Canada this week, the Chinese government reported on its website Friday.

The signing seals the companies' cooperation on the Selwyn Project, one of the top five undeveloped zinc and lead resources in the world, located in the Yukon, first announced in December last year.

As part of the agreement establishing the joint venture, Yunnan Chihong paid C$100 million (US$96 million) for a 50% stake in the Howards Pass deposit in the Selwyn Project.

The major shareholder of the state-owned Yunnan Chihong is China Yunnan Metallurgical Group Ltd., a diversified resources company majority-owned by the Yunnan Provincial Government.