(Yicai Global) June 24 -- China Nonferrous Metal Industry's Foreign Engineering and Construction, the country's main non-ferrous metals developer and project construction contractor, and Singapore's ISR Capital together plan to develop a rare earths mine in northern Madagascar.

The partners have signed a memorandum of understanding outlining the principles of their cooperation, Beijing-based China Nonferrous Metal said in a statement today.

The rare earth deposits lie on the Ampasindava peninsula about 500 kilometers north of Madagscar's capital of Antananarivo. The parties agreed that China Nonferrous Metal can take an equity stake in the project, which Singapore-listed investment holding company ISR Capital owns through its Tantalus Rare Earths Malagasy unit, and enjoy preferential rights to provide engineering, procurement and construction services.

An EPC contractor is responsible for the design, procurement, construction, commissioning and handover of a project to its owner or end-user.

The statement offered no specifics as to the Chinese company's obligations under the deal or of the project's rare earth resources, investment and construction plan. But it did say the company would also have the option to buy 3,000 tons of the mine's output within three years of its successful completion and operational start.

China Nonferrous Metal owns rare earth production capacity in southern China and has a significant market presence.

Editor: Ben Armour