UPDATE 1-Inmet Mining to get $335 mln in royalty repurchase

* Says Ok Tedi to repurchase 5 pct net smelter royalty

* NSR repurchase to close by Jan 31, 2011

Dec 2 (BestGrowthStock) – Canadian base metals producer Inmet
Mining (IMN.TO: ) said it would receive $335 million from Ok Tedi
Mining in lieu of a 5 percent net smelter royalty repurchase by
the Papua New Guinea-based miner.

Net Smelter Royalty (NSR) is a fee which is a specific
percentage of the revenue generated by a mine by selling its
product, minus production expenses.

Under the NSR agreement, Inmet would have exchanged its 18
percent equity interest in copper-gold mine Ok Tedi, and
received a cash payment equal to 18 percent of the firm’s
working capital, and a 5 percent NSR from Ok Tedi’s mine.

Shares of the Toronto, Ontario-based company have gained
little in value since it got approval from the Papua New Guinea
government for the NSR exchange, a year ago.

The NSR would have applied during Ok Tedi’s current mine
life, which is expected to end by mid-2014, Inmet said in a
statement.

The repurchase deal is expected to close by Jan 31, 2011.

Inmet, which produces copper, zinc and gold, said the NSR
repurchase has been approved by shareholders and the board of
Ok Tedi.

Inmet shares were up over a percent at C$67.10 in morning
trade on Thursday on the Toronto Stock Exchange.
(Reporting by Gowri Jayakumar in Bangalore)

UPDATE 1-Inmet Mining to get $335 mln in royalty repurchase