Polish copper miner KGHM Polska Miedz (KGH.WA) and Canada's Abacus Mining & Exploration Corp. (AME.V) have signed an agreement to create a joint venture to develop a copper and gold field in western Canada, KGHM said in a statement Tuesday.

KGHM will pay $37 million for 51% of the joint venture. Abacus will contribute its rights to the Afton Ajax field, located in the Canadian province of British Columbia, into the business.

KGHM has the option to buy a further 29% in the joint venture for up to $35 million and, if it exercises the option, it will be required to organize financing of $535 million for the joint venture's investment in the field.

According to estimates, the Afton Ajax field can produce 50,000 metric tons of copper and 100,000 ounces of gold a year. The field is expected to produce for 23 years starting in 2013, KGHM said.

-By Marcin Sobczyk, Dow Jones Newswires; +4822 447-2432; marcin.sobczyk@dowjones.com
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